Document:

Exhibit 10.1 Operating Agreement

    
      

    

     

                                                                                                           Exhibit
      10.1

     

     

    OPERATING
      AGREEMENT 

    

    OF
      

    

    INSTRIDE
      VENTURES, LLC 

    

    THIS
      OPERATING AGREEMENT (this
      “Agreement”) of InStride Ventures, LLC, a limited liability company organized
      pursuant to the Delaware Limited Liability Company Act (the “Company”), is
      entered into by and among George Foreman Ventures LLC, a Delaware limited
      liability company (“George Foreman Ventures”), In Stride, L.L.C., a Delaware
      limited liability company doing business in New Jersey as In Stride Shoes,
      L.L.C. (“In Stride”), Olen Rice, an individual (“Rice”), and Paul Koester, an
      individual (“Koester”) (individually a “Member” or collectively the
“Members”).

     

    SECTION
      1.   FORMATION;
      DEFINITIONS.

     

    1.1. Formation.
      The
      Members have caused this limited liability company to be formed under the
      Delaware Limited Liability Company Act, 6 Delaware Code § 18-101 et
      seq., as
      amended from time to time (the “Act”). The Members have caused a certificate of
      formation to be filed in accordance with the Act (the “Certificate of
      Formation”).

     

    1.2. Name.
      The
      name of the Company is “InStride Ventures, LLC” and all of the Company business
      shall be conducted under that name or such other names that comply with
      applicable law as the Manager may select from time to time.

     

    1.3. Registered
      Office; Registered Agent.
      The
      registered agent of the Company shall be The Corporation Trust Company and
      the
      registered office of the Company shall be located at Corporation Trust Center,
      1209 Orange Street, Wilmington, Delaware 19801, or at such other location (which
      need not be a place of business of the Company) as the Manager may designate
      from time to time.

     

    1.4. Principal
      Office; Other Offices.
      The
      initial principal office of the Company shall be located at c/o George Foreman
      Ventures LLC, 100 North Wilkes-Barre Boulevard, 4th
      Floor,
      Wilkes-Barre, Pennsylvania 18702. The Company may change its principal office
      or
      have such other offices as the Manager may designate from time to
      time.

     

    1.5. Purposes.
      The
      purposes of the Company are (a) to enter into a binding agreement (the “ShopKo
      Agreement”) with ShopKo Stores, Inc. (“ShopKo”) which would give the Company the
      rights to supply Shopko with Medicare reimburseable therapeutic footwear that
      includes athletic, casual and post-operative shoes and accessories, including
      shoe inserts, that meet the medical needs of individuals with specific footwear
      problems such as those related to diabetes (the “Footwear”), (b) to initially
      enter into a short-term joint venture to supply, and use celebrity marketing
      to
      market, the Footwear at fifteen (15) ShopKo stores for a period beginning
      shortly after the execution of this Agreement and ending on August 1, 2007
      (the
“Test Period”) as a test (the “ShopKo Test”) to determine whether the Footwear
      sells well enough during the

     

     

    
      
        
        

      

      
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    Test
      Period to provide business justification for George Foreman Ventures to elect
      to
      continue the joint venture with respect to the Footwear following the expiration
      of the Test Period, (c) to continue to supply and market the Footwear to ShopKo
      and/or other retail outlets or through other channels of distribution beyond
      the
      expiration of the Test Period if George Foreman Ventures decides, in its sole
      discretion, that the Company should do so, and (d) to engage in any and all
      activities related or incident to the purposes described in (a) through (c)
      of
      this Section 1.5. 

     

    1.6. Term.
      The
      Company commenced its existence upon the filing of the Certificate of Formation
      with the Secretary of State of the State of Delaware. The Company shall continue
      in perpetual existence unless and until the Company is dissolved in accordance
      with Section 8 hereof.

     

    1.7. No
      State Law Partnership.
      The
      Members intend that the Company shall not be a partnership (including, without
      limitation, a limited partnership) or joint venture, and that no Member shall
      be
      a partner or joint venturer of any other Member, for any purposes other than
      federal, state and local tax purposes, and the provisions of this Agreement
      shall not be construed otherwise.

     

    1.8. Definitions.
      As used
      in this Agreement, the following terms have the following meanings, unless
      the
      context otherwise requires:

     

    (a) “Accounting
      Period”
      means
      the following fiscal periods: the initial Accounting Period commenced on the
      date on which the Certificate of Formation was filed with the Delaware Secretary
      of State. Each subsequent Accounting Period shall commence immediately after
      the
      close of the preceding Accounting Period. Each Accounting Period shall close
      at
      the earlier of the close of business on the last day of a Fiscal Year of the
      Company or on the date of the Company’s dissolution. In addition, the Manager
      may, in its sole discretion, close the applicable Accounting Period of the
      Company upon: (1) the acceptance of a Capital Contribution from a new or
      existing Member, other than a Capital Contribution which is pro rata among
      all
      existing Members; or (2) the effective date of the withdrawal of a
      Member.

     

    (b) “Act”
      has the
      meaning set forth in Section 1.1 hereof.

     

    (c) “Adjusted
      Capital Account”
      means,
      with respect to any Member, the balance, if any, in such Member’s Capital
      Account as of the end of the relevant Accounting Period, after giving effect
      to
      the following adjustments:

     

    (1) Credit
      to
      such Capital Account any amounts which such Member is obligated to restore
      or is
      deemed to be obligated to restore pursuant to the next to the last sentences
      of
      Section 1.704-2(g)(1) and Section 1.704-2(i)(5) of the Regulations.

     

    (2) Debit
      to
      such Capital Account the items described in Section 1.704-1(b)(2)(ii)(d)(4),
      Section 1.704-1(b)(2)(ii)(d)(5) and Section 1.704-1(b)(2)(ii)(d)(6) of the
      Regulations.

     

     

    
      
        
        

      

      
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    (d) “Adjusted
      Capital Account Deficit”
      means,
      with respect to any Member, the deficit balance, if any, in such Member’s
      Capital Account as of the end of the relevant Accounting Period, after giving
      effect to the following adjustments:

     

    (1) Credit
      to
      such Capital Account any amounts which such Member is obligated to restore
      or is
      deemed to be obligated to restore pursuant to the next to the last sentences
      of
      Section 1.704-2(g)(1) and Section 1.704-2(i)(5) of the Regulations.

     

    (2) Debit
      to
      such Capital Account the items described in Section 1.704-1(b)(2)(ii)(d)(4),
      Section 1.704-1(b)(2)(ii)(d)(5) and Section 1.704-1(b)(2)(ii)(d)(6) of the
      Regulations.

     

    The
      foregoing definition of Adjusted Capital Account Deficit is intended to comply
      with the provisions of Section 1.704-1(b)(2)(ii)(d) of the Regulations and
      shall
      be interpreted consistently therewith.

     

    (e) “Affiliate”
      shall
      mean with respect to any Person, any other Person controlling, controlled by
      or
      under common control with such specified persons. The term “control”, with
      respect to any Person, means possession, direct or indirect, of the power to
      direct or cause the direction of the management and policies of such Person,
      whether through the ownership of voting securities or a general partnership
      interest or limited liability company interest, by contract or
      otherwise.

     

    (f) “Agreement”
      means
      this operating agreement, as it may be amended and/or restated from time to
      time.

     

    (g) “Capital
      Account”
      means,
      with respect to any Member, the Member’s Capital Contribution, increased or
      decreased as provided in this Agreement.

     

    (h) “Capital
      Account Balance”
      of any
      Member shall mean the balance in that Member’s Capital Account at the time of
      determination, whether positive or negative, as determined in accordance with
      the terms of this Agreement.

     

    (i) “Capital
      Contribution”
      means,
      with respect to any Member, the amount of money and the initial Gross Asset
      Value of any property other than money contributed to the Company by that
      Member.

     

    (j) “Capital
      Transaction”
      means
      any sale or other disposition of all or a portion of the Property in a single
      transaction or in a series of related transactions, other than a sale or
      disposition in the ordinary course of the Company’s business.

     

    (k) “Code”
      means
      the Internal Revenue Code of 1986, as amended from time to time. A reference
      to
      a specific section of the Code refers not only to that specific section but
      any
      corresponding provisions of any federal tax statute enacted after the date
      of
      this Agreement, as such specific section or corresponding provisions are in
      effect on the date of application of this Agreement containing such
      reference.

     

     

    
      
        
        

      

      
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    (l) “Company”
      means
      InStride Ventures, LLC, a Delaware limited liability company.

     

    (m) “Company
      Minimum Gain”
      shall
      have the meaning set forth in Sections 1.704-2(b)(2) and 1.704-2(d) of the
      Regulations.

     

    (n) “Depreciation”
      means,
      for each Accounting Period, an amount equal to the depreciation, amortization,
      or other cost recovery deduction allowable with respect to an asset for such
      year or other period, except that if the Gross Asset Value of an asset differs
      from its adjusted basis for federal income tax purposes at the beginning of
      such
      year or other period, Depreciation shall be an amount which bears the same
      ratio
      to such beginning Gross Asset Value as the federal income tax depreciation,
      amortization, or other cost recovery deduction for such year or other period
      bears to such beginning adjusted tax basis.

     

    (o) “Distributable
      Cash”
      means,
      with respect to any fiscal period, the excess of all cash receipts of the
      Company from any source whatsoever, including normal operations, sales of
      assets, proceeds of borrowings, Capital Contributions of the Members, proceeds
      from a Capital Transaction, and any and all other sources over the sum of the
      following amounts:

     

    (1) cash
      disbursements for accounting and bookkeeping services, costs of sales of Company
      assets, management fees and expenses, insurance, legal and accounting expenses,
      and any and all other items customarily considered to be “ operating
      expenses”;

     

    (2) payments
      of interest, principal and premium, and points and other costs of borrowing
      under any indebtedness of the Company (other
      than payments made with respect to Member Loans);

     

    (3) payments
      made to purchase Company assets; and

     

    (4) amounts
      set aside as Reserves.

     

    (p) “Fiscal
      Year”
      means
      the calendar year; but, upon the organization of the Company, Fiscal Year means
      the period from the first day of the term of the Company to the next following
      December 31, and upon dissolution of the Company, shall mean the period from
      the
      end of the last preceding Fiscal Year to the date of such
      dissolution.

     

    (q) “Footwear”
      has the
      meaning set forth in Section 1.5 hereof.

     

    (r) “Gross
      Asset Value”
      means,
      with respect to any asset, the asset’s adjusted basis for federal income tax
      purposes, except as follows:

     

    (1) The
      initial Gross Asset Value of any asset contributed by a Member to the Company
      shall be the gross fair market value of such asset, as determined by the
      contributing Member and the Company;

     

    (2) The
      Gross
      Asset Values of all Company assets shall be adjusted to equal their respective
      gross fair market values in connection with (and to be effective immediately
      prior to) the following events: (i) the acquisition of any additional Membership
      Interest in the Company by any new or existing Member in exchange for more
      than
      a de minimis

     

     

    
      
        
        

      

      
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    Capital
      Contribution; (ii) the acquisition of any additional Membership Interest in
      the
      Company (other than a de minimis Membership Interest) as consideration for
      the
      provision of services to or for the benefit of the Company by an existing Member
      acting in a Member capacity, or by a new Member acting in a Member capacity
      or
      in anticipation of becoming a Member; (iii) the distribution by the Company
      to a
      Member of more than a de minimis amount of Company property other than money,
      unless all Members receive simultaneous distributions of undivided interests
      in
      the distributed property in proportion to their interests in the Company; and
      (iv) the liquidation of the Company within the meaning of Regulations Section
      1.704-1(b)(2)(ii)(g); provided, however, that an adjustment pursuant to clauses
      (i), (ii) and (iii) above shall be made only if such adjustment is necessary
      or
      appropriate to reflect the relative economic interests of the Members in the
      Company;

     

    (3) If
      the
      Gross Asset Value of an asset has been determined or adjusted pursuant to
      Section l.8(r)(1) or 1.8(r)(2) hereof, such Gross Asset Value shall thereafter
      be adjusted by the Depreciation taken into account with respect to such asset
      for purposes of computing Profits and Losses; and

     

    (4) The
      Gross
      Asset Values of Company assets shall be increased (or decreased) to reflect
      any
      adjustments to the adjusted basis of such assets pursuant to Code Section 734(b)
      or Code Section 743(b), but only to the extent that such adjustments are taken
      into account in determining Capital Accounts pursuant to Regulations Section
      1.704-1(b)(2)(iv)(m); provided, however, that Gross Asset Values shall not
      be
      adjusted pursuant to this subsection to the extent that an adjustment pursuant
      to subsection 1.8(r)(2) above is made in connection with a transaction that
      would otherwise result in an adjustment pursuant to this
      subsection.

     

    (s) “Initial
      George Foreman Ventures Loan”
      has
      the
      meaning set forth in Section 3.1(b)(2) hereof.

     

    (t) “Initial
      In Stride Loan”
      has
      the
      meaning set forth in Section 3.1(b)(1) hereof.

     

    (u) “Manager”
      means
      George Foreman Ventures and any other Person or Persons hereafter designated
      as
      a Manager pursuant to the Act or the terms of this Agreement.

     

    (v) “Member
      Loan”
      has the
      meaning set forth in Section 3.2(a) hereof.

     

    (w) “Members”
      means
      George Foreman Ventures, In Stride, Rice, Koester and any other Person or
      Persons hereafter admitted to the Company as a Member as provided in this
      Agreement, but does not include any Person who has ceased to be a Member of
      the
      Company. The Members of the Company are listed on Schedule
      A
      attached
      hereto, and the Company shall keep a current list of all Members and their
      Capital Contributions. 

     

    (x) “Member
      Nonrecourse Debt”
      has the
      meaning set forth in Section 1.704-2(b)(4) of the Regulations.

     

    (y) “Member
      Nonrecourse Debt Minimum Gain”
      means
      an
      amount, with respect to each Member Nonrecourse Debt, equal to the Company
      Minimum Gain that would

     

     

    
      
        
        

      

      
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    result
      if
      such Member Nonrecourse Debt were treated as a Nonrecourse Liability, determined
      in accordance with Section 1.704-2(i)(3) of the Regulations.

     

    (z) “Member
      Nonrecourse Deductions”
      has
      the
      meaning set forth in Sections 1.704-2(i)(1) and 1.704-2(i)(2) of the
      Regulations. The amount of Member Nonrecourse Deductions with respect to a
      Member Nonrecourse Debt for any Accounting Period shall be determined in
      accordance with Section 1.704-2(i)(2) of the Regulations.

     

    (aa) “Membership
      Interest”
      shall
      mean the interest of a Member in the Company, including without limitation,
      rights to distributions (liquidating or otherwise), allocations, information
      and
      voting rights. The initial percentage Membership Interests of the Members in
      the
      Company are set forth on Schedule
      A
      attached
      hereto. 

     

    (bb) “Nonrecourse
      Deductions”
      has the
      meaning set forth in Section 1.704-2(b)(1) of the Regulations. The amount of
      Nonrecourse Deductions for an Accounting Period shall be determined in
      accordance with Section 1.704-2(c) of the Regulations.

     

    (cc) “Nonrecourse
      Liability”
      has the
      meaning set forth in Sections 1.704-2(b)(3) and 1.752-1(a)(2) of the
      Regulations.

     

    (dd) “Person”
      means an
      individual, corporation, association, partnership, joint venture, limited
      liability company, estate, trust, or any other legal entity.

     

    (ee) “Profits”
      and “Losses”
      means
      the Company’s taxable income or taxable loss, as the case may be, for each
      Accounting Period, as determined under Section 703(a) of the Code and
      Regulations Section 1.703-1, but with the following adjustments: (1) any
      tax-exempt income, as described in Section 705(a)(1)(B) of the Code, realized
      by
      the Company during such Accounting Period shall be taken into account as if
      it
      were taxable income in computing such taxable income or taxable loss; (2) any
      expenditures of the Company described in Section 705(a)(2)(B) of the Code for
      such Accounting Period, including any items treated under Regulations Section
      1.704-1(b)(2)(iv)(i) as items described in Section 705(a)(2)(B) of the Code,
      shall be taken into account as if they were deductible items in computing such
      taxable income or taxable loss; (3) any items of income recognized by the
      Company during such Accounting Period that are required to be allocated to
      the
      Members under Section 9.2(a) hereof shall be excluded from such taxable income
      or taxable loss; (4) gain or loss resulting from any disposition of Company
      property with respect to which gain or loss is recognized for federal income
      tax
      purposes shall be computed by reference to the Gross Asset Value of the property
      disposed of, notwithstanding that the adjusted tax basis of such property
      differs from its Gross Asset Value; and (5) in lieu of the depreciation,
      amortization, and other cost recovery deductions taken into account in computing
      such taxable income or loss, there shall be taken into account Depreciation
      for
      such Accounting Period, computed in accordance with Section 1.8(n) hereof.
      If
      the Company’s taxable income or taxable loss for such Accounting Period, as
      adjusted in the manner provided in Clauses (1) through (5) above, is a positive
      amount, such amount shall be the Company’s Profits for such Accounting Period;
      and if negative, such amount shall be the Company’s Losses for such Accounting
      Period.

     

     

    
      
        
        

      

      
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    (ff) “Property”
      shall
      mean, at any time, all property, whether real or personal, interests, assets
      or
      rights owned or held by or on behalf of the Company at such time.

     

    (gg) “Regulations”
      means
      the income tax regulations, including temporary regulations, promulgated under
      the Code, as such regulations may be amended from time to time (including
      corresponding provisions of succeeding regulations).

     

    (hh) “Reserve”
      or
“Reserves”
      means
      amounts set aside and deemed sufficient by the Manager, as of the date of
      determination, for working capital and to pay taxes, insurance, debt service,
      or
      other costs and expenses, incident to the operation of the Company, and for
      advancing the purposes of the Company set forth in Section 1.5
      hereof.

     

    (ii) “ShopKo
      Test”
      has the
      meaning set forth in Section 1.5 hereof.

     

    (jj) “Test
      Period”
      has
      the
      meaning set forth in Section 1.5 hereof.

     

    (kk) “Transfer”
      shall
      mean, any disposition (including, without limitation, gifts, sales, assignments,
      pledges, encumbrances, bequests, and all other inter vivos or testamentary
      dispositions) whether voluntary, involuntary or whether pursuant to court order
      or by operation of law.

     

    SECTION
      2.  MEMBERS;
      MANAGER.

     

    2.1. Members.
      The
      Members of the Company (and their Membership Interest in the Company) are listed
      on Schedule
      A
      hereto,
      each of whom has executed this Agreement as of the date hereof and is hereby
      admitted to the Company as a Member.

     

    2.2. Additional
      Members.
      No
      Person
      shall be admitted to the Company as an additional or substitute Member without
      the prior written consent of the Manager or as otherwise provided
      herein.

     

    2.3. Liability
      to Third Parties.
      No
      Member shall be liable for the debts, obligations or liabilities of the Company,
      including under a judgment, decree or order of a court, except to the extent
      required under the Act with respect to amounts distributed to the Member at
      a
      time when the Company was insolvent or was rendered insolvent by virtue of
      such
      distribution.

    

    2.4. Manager.
      The
      number of Managers of the Company shall be one (1). George Foreman Ventures
      is
      hereby designated to serve as the Manager of the Company. The Manager may resign
      at any time upon prior written notice to the Company. In the event of a vacancy
      in the position of Manager by reason of resignation, liquidation, dissolution
      or
      bankruptcy, a successor shall be appointed by a majority-in-interest of the
      Members. 

     

     

    
      
        
        

      

      
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    SECTION
      3. CAPITAL
      CONTRIBUTIONS; LOANS; ACQUISITION OF FOOTWEAR; CAPITAL
      ACCOUNTS.

     

    3.1. Initial
      Capital Contributions; Initial Loans and Acquisition of Footwear During the
      Test
      Period.
      

     

    (a) The
      Members shall, promptly after the execution of this Agreement, make the initial
      Capital Contributions set forth on Schedule
      A attached hereto
      to
      the Company in exchange for their Membership Interests. In addition, In Stride
      shall execute the license agreement attached hereto as Exhibit
      A,
      but
      shall not receive any Capital Account credit for its execution of such license
      agreement.

     

    (b) During
      the Test Period:

     

    (1) In
      Stride
      shall supply to the Company all of the Footwear required, as determined by
      the
      Manager, to undertake the ShopKo Test. In addition, In Stride shall pay all
      costs of training and Company operational overhead required (as determined
      by
      the Manager) during the Test Period to undertake the ShopKo Test. The sum of
      (a)
      In Stride’s documented direct cost of the Footwear supplied to the Company
      pursuant to this Section 3.1(b)(1), and (b) the aggregate amount of documented
      costs of training and Company operational overhead paid by In Stride pursuant
      to
      this Section 3.1(b)(1), shall constitute a loan by In Stride to the Company
      (the
“Initial In Stride Loan”) which shall not bear interest and the principal of
      which shall be repaid out of Distributable Cash pursuant to Sections 4.2(a)
      and
      4.3(a) hereof; provided, however, that (i) the documentation corresponding
      to
      any such costs shall be provided to the Manager within thirty (30) days after
      such costs are incurred, and (ii) any individual expenditure (or commitment
      to
      make an individual expenditure) in excess of ten thousand dollars ($10,000)
      shall require the approval of the Manager and the vote of those Members owning,
      in the aggregate, at least sixty percent (60%) of the Membership Interests,
      before such expenditure or commitment is incurred. Notwithstanding clause (ii)
      of this Section 3.1(b)(1), (I) the Manager shall have the ability to propose
      a
      budget to the Members, and if the proposed budget is approved by at least sixty
      percent (60%) of the Membership Interests, then the Member vote referred to
      in
      clause (ii) shall not be required unless the expenditure or commitment at issue
      would result in the approved budgeted expenses being exceeded by more than
      ten
      thousand dollars ($10,000), and (II) regardless of whether or not a budget
      has
      been approved, if the Company’s gross revenue for any Fiscal Year exceeds two
      million dollars ($2,000,000), then the Member vote referred to in clause (ii)
      shall not be required for the remainder of that Fiscal Year and for all future
      Fiscal Years. 

     

    (2) George
      Foreman Ventures shall either advance to the Company, in cash, or pay directly,
      all costs of marketing the Footwear during the Test Period, as such costs are
      determined by the Manager. The aggregate amount of cash advanced to the Company
      by George Foreman Ventures pursuant to this Section 3.1(b)(2), and documented
      costs paid directly by George Foreman Ventures pursuant to this Section
      3.1(b)(2), shall constitute a loan by George Foreman Ventures to the Company
      (the “Initial George Foreman Ventures Loan”) which shall

     

     

    
      
        
        

      

      
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    not
      bear
      interest and the principal of which shall be repaid out of Distributable Cash
      pursuant to Sections 4.2(a) and 4.3(a) hereof; provided, however, that (i)
      the
      documentation corresponding to any such costs shall be provided to the Manager
      within thirty (30) days after such costs are incurred, and (ii) any individual
      expenditure (or commitment to make an individual expenditure) in excess of
      ten
      thousand dollars ($10,000) shall require the approval of the Manager and the
      vote of those Members owning, in the aggregate, at least sixty percent (60%)
      of
      the Membership Interests, before such expenditure or commitment is incurred.
      Notwithstanding clause (ii) of this Section 3.1(b)(2), (I) the Manager shall
      have the ability to propose a budget to the Members, and if the proposed budget
      is approved by at least sixty percent (60%) of the Membership Interests, then
      the Member vote referred to in clause (ii) shall not be required unless the
      expenditure or commitment at issue would result in the approved budgeted
      expenses being exceeded by more than ten thousand dollars ($10,000), and (II)
      regardless of whether or not a budget has been approved, if the Company’s gross
      revenue for any Fiscal Year exceeds two million dollars ($2,000,000), then
      the
      Member vote referred to in clause (ii) shall not be required for the remainder
      of that Fiscal Year and for all future Fiscal Years. 

     

    3.2. Additional
      Capital Needs and Acquisition of Footwear After the Test Period.
      

     

    (a) If,
      after
      the expiration of the Test Period, the Manager determines, in its sole
      discretion, that additional capital is needed for Company business, then the
      Manager may raise such additional capital through borrowing or issuing
      additional equity in the Company, as the Manager in its sole discretion deems
      advisable. The Manager may secure third party financing from an institutional
      lender (without offering warrants or other equity participation). Additionally,
      the Manager may secure loans from its Members (“Member Loans”) with each Member
      being offered the right to participate in such loans based on its percentage
      Membership Interest, and with contributing Members having the right (but not
      the
      obligation) to contribute non-participating Members’ share of these Member
      Loans. Any such Member Loan made by a Member to the Company shall bear interest
      at the Prime Rate as published in The Wall Street Journal on the date the Member
      Loan is made plus 500 basis points, and the interest and principal of such
      Member Loan shall be repaid out of Distributable Cash as provided in Sections
      4.2 and 4.3 hereof. With respect to a proposed issuance of equity to raise
      capital for Company purposes, the Manager shall value the new equity based
      on a
      good faith determination of the fair market value of the Company at the time
      of
      the issuance of such equity, and the issuance of such equity shall be subject
      to
      the preemptive rights of the Members set forth in Section 6.2 hereof.
Notwithstanding
      the foregoing and the provisions of Section 6.2 hereof, with respect to the
      first two hundred fifty thousand dollars ($250,000) of capital raised from
      the
      Members pursuant to this Section 3.2(a), each such contributing Member shall
      acquire an additional one percent (1%) equity interest in the Company for each
      twenty-five thousand dollars ($25,000) of capital contributed by such Member
      (and with respect to any increment of capital contributed by such Member which
      is less than twenty-five thousand dollars ($25,000), such Member shall acquire
      a
      corresponding fraction of the one percent (1%) additional equity interest)
      and
      the Membership Interests of the non-contributing Members shall be diluted
      proportionately. 

     

    (b) After
      the
      expiration of the Test Period, In Stride shall sell to the Company, at In
      Stride’s direct cost and without allocable overhead, all of the Footwear
      required, as

     

     

    
      
        
        

      

      
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    determined
      by the Manager, to conduct the business of the Company. Payment for such
      Footwear shall be due from the Company to In Stride no later than the date
      of
      the shipment of such Footwear from the Orient. 

     

    (c) After
      the
      expiration of the Test Period, George Foreman Ventures shall sell to the
      Company, at George Foreman Ventures’ direct cost and without allocable overhead,
      all of the marketing materials required, as determined by the Manager, to
      conduct the business of the Company. Payment for such marketing materials shall
      be due from the Company to George Foreman Ventures immediately upon the
      Company’s receipt of such materials. The parties agree that marketing materials
      shall not include personal appearances by George Foreman, and that the terms
      and
      conditions of any such appearances shall be as negotiated and agreed upon
      between George Foreman and the Company. 

     

    3.3. Time
      When Capital Contribution to be Returned.
      No time
      is agreed upon as to when the Capital Contributions of the Members are to be
      returned. The Members shall not have the right to demand return of their Capital
      Contributions nor shall the Members have the right to demand and receive
      property other than cash in return for their Capital Contributions.

     

    3.4. Capital
      Accounts.
      An
      Adjusted Capital Account shall be maintained for each Member.

     

    (a) To
      each
      such account there shall be credited:

     

    (1) the
      amount of money contributed to the capital of the Company by such
      Member;

     

    (2) the
      fair
      market value of any property other than money contributed to the Company by
      such
      Member net of the liabilities securing such contributed property that the
      Company is considered to assume or take subject to pursuant to Section 752
      of
      the Code; and

     

    (3) Profits
      and items of income and gain allocated to the Member; and

     

    (b) From
      each
      such account there shall be debited:

     

    (1) the
      amount of money distributed to the Member by the Company;

     

    (2) the
      fair
      market value of all property distributed to such Member by the Company net
      of
      the liabilities securing such distributed property that such Member is
      considered to assume or take subject to pursuant to Section 752 of the Code;
      and

     

    (3) Losses
      and items of loss and deduction allocated to the Member.

     

    (c) In
      addition to the foregoing adjustments, each Member’s Adjusted Capital Account
      shall be maintained consistently with and reflect all adjustments described
      in
      Regulations Section 1.704-1(b)(2)(iv).

     

    (d) If
      ownership of any Membership Interest in the Company is assigned in accordance
      with the terms of this Agreement, the assignee shall succeed to the Capital
      Account of the assignor to the extent it relates to the assigned Membership
      Interest.

     

     

    
      
        
        

      

      
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    (e) In
      determining the amount of any liability for purposes of subsections 3.4(a)
      and
      (b) above, there shall be taken into account Code Section 752(c) and any other
      applicable provisions of the Code and Regulations.

     

    (f) To
      each
      Member’s Capital Account, there shall be debited or credited, as the case may
      be, adjustments which are necessary to reflect a revaluation of Company assets
      to reflect the Gross Asset Value of all Company assets, as required by
      Regulations Section 1.704-1(b)(2)(iv)(f) and Section 1.8(r).

     

    The
      foregoing provisions and the other provisions of this Agreement relating to
      the
      maintenance of Capital Accounts are intended to comply with Section 704 of
      the
      Code and Regulation Section 1.704-1(b) and shall be interpreted and applied
      in a
      manner consistent with such provisions. The Company shall make any adjustments
      that are necessary or appropriate to maintain equality between the Capital
      Accounts of the Members and the amount of Company capital reflected on the
      Company’s balance sheet as computed for book purposes in accordance with Section
      1.704-1(b)(2)(iv)(q) of the Regulations. 

     

    SECTION
      4. DISTRIBUTIONS;
      ALLOCATION OF PROFITS AND LOSSES.

     

    4.1. Distributions.
      Subject
      to maintaining the Company in a sound financial and cash position (which,
      without limiting the generality of the foregoing, shall include the provision
      for losses affecting the cash position of the Company and the payment or
      provision for payment, when due, of obligations of the Company) and establishing
      such Reserves as are determined by the Manager, in its sole discretion, to
      be
      reasonably required, the Manager shall distribute funds of the Company as
      provided herein.   

     

    4.2. Distributions
      of Distributable Cash from Operations.
      If the
      Manager decides in its discretion to distribute cash flow, then distributions
      of
      Distributable Cash arising from operations, other than Capital Transactions,
      to
      the extent available, shall be made to the Members in the following order of
      priority:

    

    (a) first,
      to
      In Stride and George Foreman Ventures, the amount required to provide them
      with
      the outstanding principal balance of the Initial In Stride Loan and the Initial
      George Foreman Ventures Loan, respectively, pro rata in accordance with the
      respective amounts of the outstanding principal balances of the Initial In
      Stride Loan and the Initial George Foreman Ventures Loan; 

     

    (b) second,
      to each Member who has made a Member Loan, the amount, if any, required to
      provide such Member with any current and accumulated interest on his or its
      Member Loan, pro rata in accordance with the respective amounts of current
      and
      accumulated interest of all Member Loans;

     

    (c) third,
      to
      each
      Member who has made a Member Loan, the amount, if any, required to provide
      such
      Member with the outstanding principal balance of his or its Member

     

     

    
      
        
        

      

      
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    Loan,
      pro
      rata in accordance with the respective amounts of the outstanding principal
      balances of all Member Loans; and 

     

    (d) thereafter,
      to the Members pro rata in accordance with their Membership
      Interests.

    

    Notwithstanding
      the foregoing provisions of this Section 4.2, after making the distributions
      provided for in subsections (a) and (b) of this Section 4.2, and prior to making
      the distributions provided for in subsections (c) and (d) of this Section 4.2,
      the Company shall, to the extent available, distribute the Tax Distribution
      Amount (as defined in Section 4.5 hereof) to the Members.

    

    4.3. Distributions
      of Distributable Cash Arising from Capital Transactions and Upon
      Liquidation.
      If the
      Manager decides in its discretion to distribute cash flow, then Distributable
      Cash arising out of a Capital Transaction and net proceeds upon liquidation
      of
      the Company, to the extent available, shall be made to the Members in the
      following order of priority:

    

    (a) first,
      to
      In Stride and George Foreman Ventures, the amount required to provide them
      with
      the outstanding principal balance of the Initial In Stride Loan and the Initial
      George Foreman Ventures Loan, respectively, pro rata in accordance with the
      respective amounts of the outstanding principal balances of the Initial In
      Stride Loan and the Initial George Foreman Ventures Loan; 

     

    (b) second,
      to each Member who has made a Member Loan, the amount, if any, required to
      provide such Member with any current and accumulated interest on his or its
      Member Loan, pro rata in accordance with the respective amounts of current
      and
      accumulated interest of all Member Loans;

     

    (c) third,
      to
      each
      Member who has made a Member Loan, the amount, if any, required to provide
      such
      Member with the outstanding principal balance of his or its Member Loan, pro
      rata in accordance with the respective amounts of the outstanding principal
      balances of all Member Loans; 

     

    (d) fourth,
      to all Members with positive Adjusted Capital Account Balances in proportion
      to,
      and to the extent of, such positive balances; and

     

    (e) thereafter,
      to the Members pro rata in accordance with their Membership
      Interests.

     

    Notwithstanding
      the foregoing provisions of this Section 4.3, after making the distributions
      provided for in subsections (a) and (b) of this Section 4.3, and prior to making
      the distributions provided for in subsections (c), (d) and (e) of this Section
      4.3, the Company shall, to the extent available, distribute the Tax Distribution
      Amount (as defined in Section 4.5 hereof) to the Members.

     

     

    
      
        
        

      

      
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    4.4. Tax
      Withholding.
      The
      Members acknowledge and agree that the Company shall withhold for the payment
      of
      any foreign, state, federal and/or local taxes which may arise as a result
      of
      being a Member of the Company to the extent required by law.

     

    4.5. Time
      of Distributions.
      Except
      as otherwise provided herein, distributions may be made from the Company to
      the
      Members at such times as the Manager in its discretion may determine;
PROVIDED,
      HOWEVER,
      that
      the Company shall endeavor to distribute to each Member in cash, if available,
      no less than the “Tax Distribution Amount” within ten (10) days following the
      end of each quarter. For purposes of this Agreement, the “Tax Distribution
      Amount” for each Member for each quarter shall be an amount equal to (a) the
      aggregate taxable income taxed to such Member for federal income tax purposes
      for such quarter as a result of allocations of Profits and Losses under Section
      4.6 multiplied by (b) the sum, expressed as a percentage, of (1) the highest
      marginal federal individual income tax rate in effect for that quarter plus
      (2)
      the highest marginal New Jersey individual income tax rate in effect for that
      quarter. 

     

    4.6. Profits
      and Losses.
      

     

    (a) Subject
      to the special allocations set forth in Section 9 hereof, the Profits of the
      Company shall be determined each year in accordance with the accounting methods
      followed for federal income tax purposes and allocated as follows:

     

    (1) first,
      to
      each Member with an Adjusted Capital Account Deficit pro rata to such Adjusted
      Capital Account Deficits to the extent of the amounts necessary to eliminate
      such Adjusted Capital Account Deficits;

     

    (2) second,
      to each Member to the extent such Member was previously allocated Losses, in
      proportion to the amount of such Losses;
      and

     

    (3) thereafter,
      any remaining Profits shall be allocated to the Members pro rata in accordance
      with their percentage Membership Interests.

     

    (b) Subject
      to the special allocations set forth in Section 9 hereof, the Losses of the
      Company shall be determined each year in accordance with the accounting methods
      followed for federal income tax purposes and allocated as follows:

     

    (1) first,
      to
      the extent the Adjusted Capital Account Balance of any Member exceeds zero
      (0),
      to each such Member in proportion to and to the extent of the amounts necessary
      to cause their respective Adjusted Capital Account Balances to equal zero (0);
      

     

    (2) second,
      to In Stride, George Foreman Ventures and each Member who has made a Member
      Loan, in proportion to and to the extent of the respective amounts of the
      outstanding principal balances of the Initial In Stride Loan, the Initial George
      Foreman Ventures Loan and Member Loans; and 

     

    (3) thereafter,
      any remaining Losses shall be allocated to the Members pro rata in accordance
      with their percentage Membership Interests. 

     

     

    
      
        
        

      

      
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    SECTION
      5. MANAGEMENT;
      LIABILITY OF PARTIES; INDEMNIFICATION; PURCHASE OPTION; LICENSE
      AGREEMENT

     

    5.1. Management
      by Manager.
      Subject
      to Section 5.2 hereof, the Manager shall be responsible for the operation of
      the
      Company’s business in the ordinary course, and shall have the authority to do
      all things without the approval or consent of the Members that it determines
      in
      its sole discretion to be in furtherance of the purposes of the Company. Without
      limiting the generality of the foregoing, the Manager shall have the authority
      to:

     

    (a) arrange
      for the collection and deposit of all cash receipts of the Company;

     

    (b) establish,
      maintain, and draw upon checking and other accounts in the name of the Company,
      in such bank or banks as the Manager may, from time to time,
      select;

     

    (c) execute
      notifications, statements, reports, returns and other filings that are necessary
      or desirable to be filed with any state or federal securities
      commission;

     

    (d) except
      as
      provided in Section 7.3 hereof, make any tax elections available to the Company
      under the Code or the Regulations thereunder, to designate a tax matters partner
      of the Company, and to execute, acknowledge and deliver any and all instruments
      desirable to effectuate the foregoing;

     

    (e) employ
      accountants, attorneys, consultants and other persons, firms, corporations
      or
      entities on such terms and for such compensation as it shall
      determine;

     

    (f) arrange
      for the payment of all liabilities of the Company; 

     

    (g) arrange
      for the timely filing of all federal and state tax returns of the
      Company;

     

    (h) borrow
      money on behalf of the Company on such terms as the Manager may determine,
      provided, however, that, during the Test Period, any such borrowing in excess
      of
      ten thousand dollars ($10,000) shall be a Major Decision pursuant to Section
      5.2(a)(4) hereof and shall accordingly be subject to the Member voting
      requirement described in Section 5.2(a); 

     

    (i) hypothecate,
      encumber, and/or grant security interests in assets of the Company, provided,
      however, that, during the Test Period, any such hypothecation, encumbrance,
      and/or grant of security interests in assets of the Company having a fair market
      value in excess of ten thousand dollars ($10,000) shall be a Major Decision
      pursuant to Section 5.2(a)(5) hereof and shall accordingly be subject to the
      Member voting requirement described in Section 5.2(a); and

     

    (j) make,
      enter into, deliver and perform all contracts, agreements or undertakings,
      pay
      all costs and expenses and perform all acts deemed appropriate by the Manager
      to
      carry out the Company’s purposes. 

     

     

    
      
        
        

      

      
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    5.2. Major
      Decisions; Manager Election to Outsource Day-to-Day Activities to In
      Stride.
      

     

    (a) Notwithstanding
      anything in this Agreement to the contrary, the Manager shall not take any
      of
      the following actions or enter into any agreement which would result in any
      of
      the following actions (any such action a “Major Decision”), without the vote of
      those Members owning, in the aggregate, at least sixty percent (60%) of the
      Membership Interests:

     

    (1) change
      the nature of the Company’s business or enter into a new line of
      business;

     

    (2) engage
      in
      any transactions with a Member, any Affiliate of a Member, or any family member
      of a Member or family member of an owner of a Member or its Affiliates;

    

    (3) sell
      or
      dispose of all or substantially all of the Company’s assets other than on an
      arms-length basis; 

     

    (4) during
      the Test Period, borrow money on behalf of the Company in excess of ten thousand
      dollars ($10,000); 

     

    (5) during
      the Test Period, hypothecate, encumber, and/or grant security interests in
      assets of the Company having a fair market value in excess of ten thousand
      dollars ($10,000); and

     

    (6) enter
      into any agreement for a personal appearance fee for George Foreman in excess
      of
      ten thousand dollars ($10,000).

     

    (b) In
      Stride
      agrees that, at the election of the Manager which may be made by the Manager
      at
      any time upon notice to In Stride, In Stride shall handle, on an independent
      contractor basis, the day-to-day administration of the Company’s business,
including,
      but not limited to, billing, receivables, inventory control, warehousing,
      shipping, sales management, training of ShopKo’s (or other customer of the
      Company) pharmacists and technicians, maintenance of a customer service staff
      dedicated to answering all of ShopKo’s (or other customer of the Company)
      pharmacy requests and questions about the Footwear and Medicare program with
      respect to the Footwear, and interfacing with ShopKo (or other customer of
      the
      Company) corporate in connection with issues relating to the ShopKo Agreement
      (or agreement with such other customer) and delivery of goods and services
      thereunder. In consideration for the foregoing services, the Company shall
      pay
      In Stride a service fee in accordance with the following schedule (for purposes
      of this Section 5.2(b), a “unit” is defined as “a pair of shoes with inserts”):
(i)
      with
      respect to any calendar month in which total sales of units for such calendar
      month are not greater than three hundred (300) units, the service fee shall
      be
      thirty dollars ($30.00) per unit sold during such calendar month, and (ii)
      with
      respect to any calendar month in which total sales of units for such calendar
      month are greater than three hundred (300) units, the service fee shall be
      thirty dollars ($30.00) per unit for the first three hundred (300) units sold
      during such calendar month plus twenty-two dollars and fifty cents ($22.50)
      per
      unit for each unit sold during such calendar month in excess of three hundred
      (300) units. The

     

     

    
      
        
        

      

      
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    amount
      of
      the service fee set forth herein shall be in addition to (and not included
      in)
      the actual cost of the shoe and shoe inserts. 

     

    5.3. Authority
      to Bind the Company.
      The
      Manager or its designee shall have the right to bind the Company and to execute
      documents on the Company’s behalf. In addition to the specific rights and powers
      herein granted to the Manager, the Manager shall, subject to the limitations
      set
      forth in this Agreement, possess and enjoy and exercise all of the other rights
      and powers of Managers under the Act or granted by the law of any other
      jurisdiction in which the Company may do business. In addition, no Member other
      than the Manager may bind the Company and execute documents on the Company’s
      behalf without the prior written approval of the Manager.

     

    5.4. Appointment
      of Officers. The
      Manager may, from time to time in its sole discretion, by resolution, appoint
      such officers of the Company as it shall deem advisable.

     

    5.5. Liability
      of Parties. 

     

    (a) No
      Member, Manager or Affiliate of such Persons (a “Covered Person”) shall be
      liable to the Company or any other Covered Person for any loss, damage or claim
      incurred by reason of any act or omission performed or omitted by such Covered
      Person in good faith on behalf of the Company and in a manner reasonably
      believed to be within the scope of authority conferred on such Covered Person
      by
      this Agreement, except that a Covered Person shall be liable for any such loss,
      damage or claim incurred by reason of such Covered Person’s gross negligence or
      willful misconduct.

     

    (b) A
      Covered
      Person shall be fully protected in relying in good faith upon the records of
      the
      Company and upon such information, opinions, reports, or statements presented
      to
      the Company by any Person as to matters the Covered Person reasonably believes
      are within such Person’s professional or expert competence and who has been
      selected with reasonable care by or on behalf of the Company, including
      information, opinions, reports or statements as to the value and amount of
      the
      assets, liabilities, Profits, Losses or Distributable Cash or any other facts
      pertinent to the existence and amount of assets from which distributions to
      Members might properly be paid.

     

    (c) To
      the
      extent that, at law or in equity, a Covered Person has duties (including
      fiduciary duties) and liabilities relating thereto to the Company or to any
      Member, a Covered Person acting under this Agreement shall not be liable to
      the
      Company or to any Member for its good faith reliance on the provisions of this
      Agreement. The provisions of this Agreement, to the extent that they restrict
      the duties and liabilities of a Covered Person otherwise existing at law or
      in
      equity, are agreed by the parties hereto to replace such other duties and
      liabilities of such Covered Person.

     

    (d) Unless
      otherwise expressly provided herein, (1) whenever a conflict of interest exists
      or arises between Covered Persons, or (2) whenever this Agreement or any other
      agreement contemplated herein or therein provides that a Covered Person shall
      act in a manner that is, or provides terms that are, fair and reasonable to
      the
      Company or act in any manner that is, or provides terms that are, fair and
      reasonable to the Company or any Member, the Covered

     

     

    
      
        
        

      

      
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    Person
      shall resolve such conflicts of interest, take such action or provide such
      terms, considering in each case the relative interest of each party (including
      his, her or its own interest) to such conflict, agreement, transaction or
      situation and the benefits and burdens relating to such interests, any customary
      or accepted industry practices, and any applicable generally accepted accounting
      principles. In the absence of bad faith by the Covered Person, the resolution,
      action or term so made, taken or provided by the Covered Person shall not
      constitute a breach of this Agreement or any other agreement contemplated herein
      or of any duty or obligation of the Covered Person at law or in equity or
      otherwise.

     

    (e) Whenever
      in this Agreement a Covered Person is permitted or required to make a decision
      (1) in his, her or its “discretion” or under a grant of similar authority or
      latitude, the Covered Person shall be entitled to consider such interests and
      factors as he or it desires, including his or its own interests, and shall
      have
      no duty or obligation to give any consideration to any interest of or factors
      affecting the Company or any other Persons, or (2) in his or its “good faith” or
      under another express standard, the Covered Person shall act under such express
      standard and shall not be subject to any other or different standard imposed
      by
      this Agreement or other applicable law.

     

    5.6. Indemnification
      of Covered Persons.
      

     

    (a) To
      the
      fullest extent permitted by applicable law, a Covered Person shall be entitled
      to indemnification from the Company for any loss, damage or claim incurred
      by
      such Covered Person by reason of any act or omission performed or omitted by
      such Covered Person in good faith on behalf of the Company and in a manner
      reasonably believed to be within the scope of authority conferred on such
      Covered Person by this Agreement, except that no Covered Person shall be
      entitled to be indemnified in respect of any loss, damage or claim incurred
      by
      such Covered Person by reason of gross negligence or willful misconduct with
      respect to such acts or omissions, PROVIDED,
      HOWEVER,
      that
      any indemnity under this Section 5.6(a) shall be provided out of and to the
      extent of Company assets only, and no Member shall have any personal liability
      on account thereof. 

     

    (b) To
      the
      fullest extent permitted by applicable law, reasonable expenses (including
      legal
      fees) incurred by a Covered Person in defending any claim, demand, action,
      suit
      or proceeding shall, from time to time, be advanced by the Company prior to
      the
      final disposition of such claim, demand, action, suit or proceeding upon receipt
      by the Company of an undertaking by or on behalf of the Covered Person to repay
      such amount if it shall be determined that the Covered Person is not entitled
      to
      be indemnified as authorized in Section 5.6(a) hereof.

     

    (c) The
      Company may, but is not required to, purchase and maintain insurance, to the
      extent and in such amounts as the Manager shall deem reasonable, on behalf
      of
      Covered Persons and such other Persons as the Manager shall determine, against
      any liability that may be asserted against or expenses that may be incurred
      by
      any such Person in connection with the activities of the Company or such
      indemnities, regardless of whether the Company would have the power or
      obligation to indemnify such Person against such liability under the provisions
      of this Agreement. The Company may enter into indemnity contracts with Covered
      Persons and such other Persons as the Manager shall determine and adopt written
      procedures

     

     

    
      
        
        

      

      
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    pursuant
      to which arrangements are made for the advancement of expenses and the funding
      of obligations under Section 5.6(b) hereof and containing such other procedures
      regarding indemnification as are appropriate.

     

    5.7. Competition.
      

     

    (a) While
      a
      Member owns a Membership Interest in the Company and for a period of two (2)
      years after such Member ceases to own a Membership Interest in the Company
      for
      any reason, including without limitation dissolution of the Company, such Member
      and such Member’s Affiliates shall not directly or indirectly engage in any
      activities, perform any services or conduct any businesses which are competitive
      with the Company’s business or any part of the Company’s business or engage in
      activities or services performed by, or sell products sold by, the Company.
      Except for businesses competitive with the Company as aforesaid,
      any
      Member
      or Manager may engage in or possess an interest in other business ventures
      of
      every type and description, independently or with others, and neither the
      Company nor any of the Members shall have any right by virtue of this Agreement
      in or to any such independent ventures or to the income or profits derived
      therefrom. The fact that a Member or Manager or an organization or other entity
      which is related, directly or indirectly, is employed by or is directly or
      indirectly interested in or is connected with any person, firm, organization
      or
      entity engaged in or employed by the Company, to render or perform a service,
      or
      from whom or which the Company may buy property of any sort, kind and
      description, shall not prohibit the Company from executing any agreement with
      or
      employing such person, organization, firm, corporation, or entity, or from
      otherwise dealing with him or it, in any manner whatsoever, so long as such
      dealing is on an arm’s length basis, and neither the Company nor any of the
      Members, as such, shall have any rights in or to any income or profits derived
      by it or the related party.

     

    (b) Notwithstanding
      Section 5.7(a) hereof or any other provision of this Agreement, In Stride shall
      retain a limited right to sell and distribute Footwear solely as provided in
      the
      Exclusive Trademark License Agreement attached hereto as Exhibit
      A;
      provided, however, that such license agreement shall terminate upon a
      dissolution of the Company or upon George Foreman Ventures’ material breach of
      this Agreement if such material breach is not cured within thirty (30) days
      after George Foreman Ventures receives written notice from In Stride of such
      material breach. 

     

    5.8. Company’s
      Option to Purchase Assets of In Stride.
      

     

    (a) For
      a
      period of two (2) years after the date of this Agreement, the Company shall
      have
      the option to purchase the assets of In Stride (other than its Membership
      Interest in the Company). In the event such option is exercised, (i) the Company
      shall purchase all of In Stride’s undamaged inventory that is salable in the
      ordinary course of business at a purchase price equal to In Stride’s cost,
      including but not limited to acquisition cost, freight, warehousing and
      allocable overhead, and (ii) the Company shall purchase the assets of In Stride
      other than the inventory at a purchase price equal to five (5) times the EBITDA
      of In Stride for the twelve-month period ending on the date the option is
      exercised (such EBITDA being determined without regard to any extraordinary
      income or expenses of In Stride during said twelve-month period, including,
      but
      not limited to, income derived and expenses incurred in

     

     

    
      
        
        

      

      
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    connection
      with In Stride’s fulfillment of its obligations to supply goods to the Company
      hereunder) (the “EBITDA Calculation”). Notwithstanding the foregoing, if the
      amount determined pursuant to the EBITDA Calculation is less than one million
      dollars ($1,000,000), then the amount determined pursuant to the EBITDA
      Calculation shall be increased by one-half (1/2) of the difference between
      one
      million dollars ($1,000,000) and the amount determined pursuant to the EBITDA
      Calculation. The foregoing option shall be exercisable by written notice from
      the Manager to In Stride within two (2) years after the date of this Agreement,
      and in the event of exercise, the Company and In Stride shall enter into a
      purchase and sale agreement to be negotiated in good faith and which shall
      provide for cash payment in full at closing and contain standard
      representations, warranties, and indemnities. 

     

    (b) If
      the
      Company exercises the option provided for in Section 5.8(a) hereof, then the
      Company and Dan Werremeyer Jr. (“Werremeyer”) shall enter into an employment
      agreement to be negotiated in good faith with respect to Werremeyer’s employment
      with the Company and which shall provide for the term, title and compensation
      set forth in this Section 5.8(b). The term of such employment agreement shall
      be
      three (3) years, and shall provide for the Company’s employment of Werremeyer as
      its President. Such employment agreement shall require Werremeyer to dedicate
      a
      substantial amount of his time to his services as President of the Company
      and
      shall provide for Werremeyer to receive, during such three-year term, (i) an
      annual base compensation of one hundred fifty thousand dollars ($150,000),
      (ii)
      with respect to each year that the gross revenue of the Company is greater
      than
      five million dollars ($5,000,000) and less than twenty million dollars
      ($20,000,000), a bonus (in addition to the base compensation set forth in clause
      (i) of this Section 5.8(b)) in the amount of fifty thousand dollars ($50,000),
      and (iii) with respect to each year that the gross revenue of the Company is
      equal to or greater than twenty million dollars ($20,000,000), a bonus (in
      addition to the base compensation set forth in clause (i) of this Section
      5.8(b)) in the amount of one hundred thousand dollars ($100,000). 

     

    (c) If
      the
      Company exercises the option provided for in Section 5.8(a) hereof, then the
      Company and Robert Schwartz (“Schwartz”) shall enter into an employment
      agreement to be negotiated in good faith with respect to Schwartz’s employment
      with the Company and which shall provide for the term, title and compensation
      set forth in this Section 5.8(c). The term of such employment agreement shall
      be
      three (3) years, and shall provide for the Company’s employment of Schwartz as
      its Vice President of Pharmacies. Such employment agreement shall require
      Schwartz to dedicate a substantial amount of his time to his services as Vice
      President of Pharmacies of the Company and shall provide for Schwartz to
      receive, during such three-year term, (i) an annual base compensation of
      seventy-five thousand dollars ($75,000), (ii) with respect to each year that
      the
      gross revenue of the Company is greater than five million dollars ($5,000,000)
      and less than twenty million dollars ($20,000,000), a bonus (in addition to
      the
      base compensation set forth in clause (i) of this Section 5.8(c)) in the amount
      of twenty-five thousand dollars ($25,000), and (iii) with respect to each year
      that the gross revenue of the Company is equal to or greater than twenty million
      dollars ($20,000,000), a bonus (in addition to the base compensation set forth
      in clause (i) of this Section 5.8(c)) in the amount of fifty thousand dollars
      ($50,000).

     

     

    
      
        
        

      

      
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    (d) In
      Stride
      agrees that it shall not engage in any sale or other disposition of its assets
      outside the ordinary course of business prior to the expiration of the period
      during which the Company may exercise its option pursuant to Section 5.8(a)
      hereof or engage in any other transaction or activity that would adversely
      affect or interfere with the Company’s option. 

     

    5.9. License
      Agreement with George Foreman Ventures.
      George
      Foreman Ventures and the Company shall enter into the license agreement attached
      hereto as Exhibit
      B. 

     

    SECTION
      6. TRANSFERABILITY
      OF MEMBERSHIP INTERESTS.

     

    6.1. Restrictions
      on Transfer.
      

     

    (a) Except
      as
      specifically provided in this Agreement, no Member shall Transfer, directly
      or
      indirectly (including, without limitation, through a Transfer of a membership
      interest, beneficial interest in a trust, partnership interest or shares in
      an
      entity that is a Member), all or any portion of his or its Membership Interest
      in the Company. 

     

    (b) Subject
      to Section 6.3 hereof, and notwithstanding the limitations of Section
      6.1(c)(5)(c)(i) and (ii) hereof, a Member may Transfer all or any portion of
      his
      or its Membership Interest in the Company to any transferee (“Approved
      Transferee”) with the prior written consent of the Manager, which may be granted
      or withheld in its sole and absolute discretion.

     

    (c) Permitted
      Transferees. 

     

    (1) Subject
      to Section 6.3 hereof, upon his death, each individual Member, if any (or
      individual owner of a Member) shall have, and at all times retain the right
      to
      Transfer all or any portion of his Membership Interest (or interest in a Member)
      outright or in trust to or for the benefit of his spouse or descendants, or
      to
      any entity which is wholly owned by such Member, such Member’s spouse or
      descendants, the foregoing trusts, or any combination of the foregoing. Subject
      to Section 6.3 hereof, each corporate Member, each limited partnership Member
      and each limited liability company Member, if any, shall have the right to
      Transfer all or any part of its Membership Interest to any owner of such Member,
      to such owner’s spouse, descendants and/or a trust or trusts for the benefit of
      the foregoing, or to any entity which is wholly owned by such owner, such
      owner’s spouse or descendants, the foregoing trusts, or any combination of the
      foregoing.

     

    (2) Subject
      to Section 6.3 hereof, if a Membership Interest is held in trust, the holders
      of
      such Membership Interest shall have the right to Transfer such Membership
      Interest to successor trustees and/or to the beneficiaries of such trust in
      accordance with the terms thereof.

     

    (3) The
      Person or Persons receiving a Membership Interest pursuant to the terms of
      this
      subsection (c) shall be referred to hereinafter individually as such Member’s
“Permitted Transferee” and collectively as his, her or its “Permitted
      Transferees.”

     

     

    
      
        
        

      

      
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    (4) Any
      Permitted Transferee shall receive and hold the Membership Interest so
      Transferred subject to the terms and conditions of this Agreement as though
      a
      party hereto, and no Transfer of any Membership Interest shall be made to such
      Approved Transferee or Permitted Transferee unless he shall so acknowledge
      in
      writing to be bound by all of the terms and conditions of this Agreement. Upon
      the satisfaction of the above and complying with Section 6.3 hereof, the
      Approved Transferee or Permitted Transferee shall be admitted to the Company
      as
      a Member.

     

    (5) A
      Permitted Transferee shall not Transfer all or any portion of his or its
      Membership Interest in the Company unless such a Transfer is made (a) subject
      to
      the provisions of this Section 6.1, (b) subject to the provisions of Section
      6.3
      hereof, and (c):

     

    (i) to
      the
      Member from whom he, she or it obtained the Membership Interest; or

     

    (ii) to
      another Permitted Transferee of the Member from whom he, she or it obtained
      the
      Membership Interest.

     

    (d) Following
      any Transfer of a Member’s entire Membership Interest, the Member shall have no
      further rights as a Member of the Company. 

     

    6.2. Preemptive
      Rights.

     

    (a) If,
      following the expiration of the Test Period, the Company authorizes the issuance
      or sale of any equity in the Company to any Person (including any Member) (the
      "Offeree"), the Company shall first offer to sell to each Member a pro-rata
      portion (based on the Membership Interest held by such Member at such time)
      of
      such equity. The Members shall be entitled to purchase such equity at the same
      price as such equity is to be offered to the Offeree. The Members will take
      all
      necessary or desirable actions in connection with the consummation of the
      purchase transactions contemplated by this Section 6.2(a) as requested by the
      Company, including the execution of all agreements, documents and instruments
      in
      connection therewith in the form presented by the Company, and so long as such
      agreements, documents and instruments do not require such Members to make more
      burdensome representations, warranties, covenants or indemnities than those
      required of the Offeree in the agreements, documents or instruments in
      connection with such transaction. If any Member elects not to purchase any
      such
      equity, or not to purchase all of such Member’s pro-rata portion, each other
      Member who has elected to purchase all of such Member’s pro-rata portion (a
      "Fully Participating Member") shall be entitled to purchase an additional
      portion of such equity. If more than one Fully Participating Member desires
      to
      purchase such equity in excess of the portion allocated to such Member pursuant
      to the first sentence of this Section 6.2(a), then each such Fully Participating
      Member shall be entitled to purchase up to all of such available equity. If
      there is an oversubscription in respect of such remaining equity, the
      oversubscribed amount shall be fully allocated among the Fully Participating
      Members pro rata based on such Fully Participating Members’ percentage
      Membership Interest. Notwithstanding the foregoing or anything contained to
      the
      contrary herein, no Member shall be entitled to purchase equity pursuant to
      this
      Section 6.2(a) in the event such Member is in breach of, or has not complied
      with all of such Member’s obligations under this Agreement or other agreements
      to which such Member and the Company are a party.

     

     

    
      
        
        

      

      
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    (b) In
      order
      to exercise its purchase rights hereunder, a Member must, within forty-five
      (45)
      days after receipt of written notice from the Company describing the equity
      being offered, the purchase price thereof, the payment terms and such Member’s
      percentage allotment, deliver a written notice to the Company describing its
      election hereunder (which election shall be absolute and unconditional). The
      forty-five (45) day time frame described herein shall apply both in the case
      of
      an initial written notice from the Company to the Members with respect to an
      offering of equity and in the case of any subsequent written notice from the
      Company to the Fully Participating Members with respect to an additional portion
      of such equity available for purchase as a result of another Member electing
      not
      to purchase all of its pro-rata portion. 

     

    (c) Upon
      the
      expiration of the offering period described above, the Company shall be entitled
      to sell such equity to the Offeree which the Members have not elected to
      purchase during the 180 days following such expiration at no less than the
      purchase price stated in the notice provided under Section 6.2(b)
      hereunder. Any equity proposed to be offered or sold by the Company to the
      Offeree after such 180-day period, or at a price not complying with the
      immediate preceding sentence, must be reoffered to the Members pursuant to
      the
      terms of this Section 6.2 prior to any sale to the Offeree.

     

    6.3. Conditions
      to Transfer.
      A
      Transfer of a Membership Interest in the Company shall be effective only upon
      satisfaction of the following conditions:

     

    (a) The
      Membership Interest with respect to which the transferee is admitted was
      acquired either in exchange for a Capital Contribution pursuant to Section
      3.1
      or 3.2(a) or by means of a Transfer permitted under subsection 6.1
      hereof;

     

    (b) The
      transferee executes such documents and instruments as the Company may reasonably
      request as necessary or appropriate to confirm such transferee as a Member
      in
      the Company and such transferee’s agreement to be bound by the terms and
      conditions hereof;

     

    (c) The
      transferee furnishes copies of all instruments effecting the Transfer and such
      other certificates, instruments and documents as the Company may
      require;

     

    (d) At
      the
      request of the Manager, the transferee provides the Company with an opinion
      of
      counsel stating:

     

    (1) that
      such
      Transfer may be effected without registration of the Membership Interest under
      the Securities Act of 1933, as amended;

     

    (2) that
      such
      Transfer does not cause the violation of any state or federal securities law
      (including any investment suitability standards);

     

    (3) that
      such
      Transfer will not result in a termination of the Company pursuant to Section
      708(b)(1)(B) of the Code;

     

    (4) that
      such
      Transfer will not cause the Company or any entity in which the Company invests
      to be subject to any state or federal registration requirements;
      and

     

    (5) such
      other matters as the Manager may reasonably request.

     

     

     

    
      
        
        

      

      
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    (e) The
      transferee provides the Manager with a fully-executed and acknowledged written
      instrument of Transfer setting forth the intention of the transferor that the
      transferee become a Member in his or its place and stead;

     

    (f) The
      transferee and the transferor execute and acknowledge such other instruments
      as
      the Manager may deem necessary or desirable to effect such admission, including
      the written acceptance and adoption by the transferee of the provisions of
      this
      Agreement (including the power of attorney contained in Section 10.9 hereof)
      and
      the assumption by the transferee of all obligations of the transferor under
      this
      Agreement; and

     

    (g) The
      transferee has paid all reasonable expenses incurred by the Company (including
      any legal and accounting fees) in connection with such Transfer, including,
      but
      not limited to, the cost of the preparation, filing and publishing of any
      amendment to the Company’s certificate of formation or any other amendments or
      filings.

     

    6.4. Prohibited
      Transfers.
      Any
      purported Transfer that is not permitted under this Section shall be null and
      void and of no effect whatsoever. 

     

    SECTION
      7. BOOKS
      AND RECORDS; ACCOUNTING AND TAX ELECTIONS

     

    7.1. Maintenance
      of Records.
      The
      Company shall maintain true and correct books and records, in which shall be
      entered all transactions of the Company, and shall maintain all other records
      necessary, convenient or incidental to recording the Company’s business and
      affairs, which shall be sufficient to record the allocation of Profits and
      Losses and distributions as provided for herein. All decisions as to accounting
      principles, accounting methods and other accounting matters shall be made by
      the
      Manager. Each Member or his or its authorized representative may, as often
      as
      quarterly and to the extent required by § 18-305 of the Act, examine the books
      and records of the Company during normal business hours upon reasonable notice
      for a proper purpose reasonably related to the Member’s Membership Interest in
      the Company.

     

    7.2. Reports
      to Members.
      As soon
      as practicable after the end of each fiscal quarter, the Company (a) shall
      cause
      to be prepared and sent to each Member a balance sheet and a statement of income
      for the Company which may, but need not, be audited by a certified public
      accountant, and (b) shall cause to be prepared and sent to each Member a report
      setting forth in sufficient detail all such information and data with respect
      to
      the Company for such fiscal quarter as shall enable each Member to prepare
      his
      or its income tax returns in accordance with the laws, rules and regulations
      then prevailing. The Company shall also cause to be prepared and filed all
      tax
      returns required of the Company. All balance sheets, statements, reports and
      tax
      returns required to be prepared by the Company pursuant to this Section 7.2
      shall be prepared at the expense of the Company.

     

     

    
      
        
        

      

      
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    7.3. Tax
      Election; Determinations Not Provided for in Agreement.
      The
      Manager shall be empowered to make or revoke any elections now or hereafter
      required or permitted to be made by the Code or any state or local tax law,
      and
      to decide in a fair and equitable manner any accounting procedures and other
      matters arising with respect to the Company or under this Agreement which are
      not expressly provided for in this Agreement. Notwithstanding the foregoing,
      neither the Company nor any Manager or Member shall make an election for the
      Company to be excluded from taxation as a partnership under the Code or any
      state or local law, and no provision of this Agreement (including Section 1.7)
      shall be construed to sanction or approve any such election.

     

    7.4. Tax
      Matters Partner.
      George
      Foreman Ventures is hereby designated to be the “tax matters partner” of the
      Company pursuant to the requirements of the Code and shall have the authority
      to
      exercise all functions provided for in the Code, or in the Regulations,
      including, to the extent permitted by such Regulations, the authority to
      delegate the function of “tax matters partner” to any other person. George
      Foreman Ventures shall be reimbursed for all reasonable expenses incurred as
      a
      result of its duties as “tax matters partner”. 

     

    SECTION
      8. DISSOLUTION
      AND LIQUIDATION; TERMINATION AND WITHDRAWAL.

     

    8.1. Dissolution.
      The
      Company shall dissolve and its affairs shall be wound up at any time upon the
      decision of the Manager. 

     

    8.2. Liquidation.

     

    (a) Upon
      a
      dissolution of the Company requiring the winding-up of its affairs, the Manager
      shall wind up its affairs. The assets of the Company shall be sold within a
      reasonable period of time to the extent necessary to pay or provide for the
      payment of all debts and liabilities of the Company, and may be sold to the
      extent deemed practicable and prudent by the Manager.

     

    (b) The
      net
      assets of the Company remaining after satisfaction of all such debts and
      liabilities and the creation of any reserves under subsection 8.2(d), shall
      be
      distributed to the Members in accordance with their positive Capital Account
      Balances as of the date of such distribution, after giving effect to all
      contributions, distributions and allocations for all periods, including the
      period during which such liquidation occurs. Any property distributed in kind
      in
      the liquidation shall be valued at fair market value.

     

    (c) Distributions
      to Members pursuant to this Section 8 shall be made by the later of (i) the
      end
      of the taxable year of the liquidation, or (ii) ninety (90) days after the
      date
      of such liquidation in accordance with Regulations Section
      1.704-1(b)(2)(ii)(b).

     

    (d) The
      Manager may withhold from distribution under this Section 8.2 such reserves
      which are required by applicable law and such other reserves for subsequent
      computation adjustments and for contingencies, including contingent liabilities
      relating to pending or anticipated litigation or to Internal Revenue Service
      examinations. Any amount held

     

     

    
      
        
        

      

      
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    as
      a
      reserve shall reduce the amount payable under this Section 8.2 and shall be
      held
      in a segregated interest-bearing account (which may be commingled with similar
      accounts). The unused portion of any reserve shall be distributed with interest
      thereon pursuant to this Section 8.2 after the Manager shall have determined
      that the need therefore shall have ceased.

     

    8.3. Deficit
      Capital Accounts.
      If a
      Member has a deficit balance in his or its Capital Account after giving effect
      to all contributions, distributions and allocations for all taxable years,
      including the year in which the liquidation occurs, such deficit shall not
      be
      considered a debt owed by such Member to the Company and such Member shall
      not
      be obligated to contribute such amount to the Company to bring the Capital
      Account Balance of such Member’s Capital Account to zero (0).

     

    8.4. Restrictions
      on Withdrawal.
      Except
      as otherwise expressly permitted in this Agreement, without the consent of
      the
      Manager, which may be withheld in its absolute discretion, a Member does not
      have the right to withdraw from the Company as a Member or terminate his or
      its
      Membership Interest.   

     

    SECTION
      9.  ALLOCATION
      RULES.

     

    9.1. Special
      Allocations.

     

    (a) Minimum
      Gain Chargeback.
      Notwithstanding any other provision of Section 4 or this Section 9, except
      to
      the extent that Section 1.704-2(f) of the Regulations (or any other applicable
      authority) provides an exception to the operation of the minimum gain chargeback
      requirement of the Regulations, if there is a net decrease in Minimum Gain
      during any Accounting Period, each Member shall be specially allocated items
      of
      income and gain for such Accounting Period in an amount equal to such Member’s
      share of the net decrease in the Company’s Minimum Gain (within the meaning of
      Regulations Section 1.704-2(g)(2)), determined in accordance with Regulations
      Section 1.704-2(g). In the event that the minimum gain chargeback requirement
      imposed by this subsection and Regulations Section 1.704-2(f) exceeds the
      Company’s income and gains for the Accounting Period, the excess shall be
      treated as a minimum gain chargeback requirement, and shall be specially
      allocated under this subsection, in the immediately succeeding Accounting
      Periods until fully charged back. Allocations pursuant to this subsection shall
      be made in proportion to the respective amounts required to be allocated to
      each
      Member pursuant hereto. The items to be allocated shall be determined in
      accordance with Sections 1.704-2(f)(6) and 1.704-2(j) of the Regulations. This
      subsection 9.1(a) is intended to comply with the minimum gain chargeback
      requirement in the Regulations and shall be interpreted consistently
      therewith.

     

    (b) Member
      Nonrecourse Debt Minimum Gain Chargeback.
      Notwithstanding any other provision of Section 4 or this Section 9, except
      to
      the extent that Section 1.704-2(i)(4) of the Regulations (or any other
      applicable authority) provides an exception to the operation of the partner
      nonrecourse debt minimum gain chargeback requirement of the Regulations, if
      there is a net decrease in Member Nonrecourse Debt Minimum Gain attributable
      to
      a Member

     

     

    
      
        
        

      

      
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    Nonrecourse
      Debt during any Accounting Period, each Member who has a share of the Member
      Nonrecourse Debt Minimum Gain attributable to such Member Nonrecourse Debt,
      determined in accordance with Regulations Section 1.704-2(i)(5), as of the
      beginning of that Accounting Period, shall be specially allocated items of
      income and gain for such Accounting Period (and, if necessary, succeeding
      Accounting Periods) in an amount equal to such Member’s share of the net
      decrease in Member Nonrecourse Debt Minimum Gain. A Member’s share of the net
      decrease in Member Nonrecourse Debt Minimum Gain shall be determined in a manner
      consistent with the provisions of Regulations Sections 1.704-2(j)(2) and
      1.704-2(i)(4). Allocations pursuant to this subsection shall be made in
      proportion to the respective amounts required to be allocated to each Member
      pursuant to this subsection and Section 1.704-2(i)(4) of the Regulations. The
      items to be so allocated shall be determined in accordance with Sections
      1.704-2(i)(4) and (j)(2) of the Regulations.

     

    This
      subsection 9.1(b) is intended to comply with the partner nonrecourse debt
      minimum gain chargeback requirement in the Regulations and shall be interpreted
      consistently therewith.

     

    (c) Qualified
      Income Offset.
      If any
      Member unexpectedly receives any adjustments, allocations or distributions
      described in Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5), and (6), items
      of income and gain (consisting of a pro rata portion of each item of income,
      including gross income and gain) shall be specially allocated to that Member
      in
      an amount and manner sufficient to eliminate any Adjusted Capital Account
      Deficit created by such adjustments, allocations or distributions as quickly
      as
      possible; PROVIDED,
      HOWEVER,
      that an
      allocation pursuant to this subsection shall be made only if and to the extent
      that such Member would have an Adjusted Capital Account Deficit after all other
      allocations provided for in this Article have been tentatively made as if this
      subsection were not a part of this Agreement.

     

    (d) Gross
      Income Allocation.
      If any
      Member has a deficit Capital Account at the end of any Accounting Period that
      is
      in excess of the sum of the amount such Member is obligated to restore, or
      the
      amount such Member is deemed obligated to restore pursuant to the next to last
      sentences of Section 1.704-2(g)(1) and Section 1.704-2(i)(5) of the Regulations,
      the Member shall be specially allocated items of income and gain in the amount
      of such excess as quickly as possible; PROVIDED,
      HOWEVER,
      that an
      alloca-tion pursuant to this subsection shall be made only if and to the extent
      that such Member would have a deficit Capital Account in excess of such sum
      after all other allocations provided for in this Article have been tentatively
      made as if this subsection and the qualified income offset provision set forth
      in the preceding subsection were not a part of this Agreement.

     

    (e) Code
      Section 754 Adjustments.
      To the
      extent an adjustment to the adjusted tax basis of any asset of the Company
      pursuant to Code Section 734(b) or Code Section 743(b) is required, pursuant
      to
      Regulations Section 1.704-1(b)(2)(iv)(m)(2) or (4), to be taken into account
      in
      determining Capital Accounts as a result of a distribution to a Member in
      complete liquidation of its interest in the Company, the amount of such
      adjustment to the Capital Accounts of the Members shall be treated as an item
      of
      gain (if the adjustment increases the basis of the asset) or loss (if the
      adjustment decreases such basis) and such gain or loss shall be

     

     

    
      
        
        

      

      
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    specially
      allocated to the Members in accordance with their interests in the Company
      in
      the event Regulations Section 1.704-1(b)(2)(iv)(m)(2) applies, or to the Member
      to whom such distribu-tion was made in the event Regulations Section
      1.704-1(b)(2)(iv)(m)(4) applies.

     

    (f) Nonrecourse
      Deductions.
      Nonrecourse Deductions for any Accounting Period shall be specially allocated
      to
      the Members, in accordance with the Members’ Membership Interests in the Company
      for the applicable Accounting Period.

     

    (g) Member
      Nonrecourse Deductions.
      Any
      Member Nonrecourse Deductions for any Accounting Period shall be specially
      allocated to the Member who bears the economic risk of loss with respect to
      the
      Member Nonrecourse Debt to which such Member Nonrecourse Deductions are
      attributable in accordance with Regulations Section 1.704-2(i).

     

    (h) Corrective
      Allocations.
      The
      allocations set forth in the preceding subsections of this Section 9.1 (the
      “Regulatory Allocations”) are intended to comply with certain requirements of
      the Regulations. It is the intent of the Members that, to the extent possible,
      all Regulatory Allocations shall be offset either with other Regulatory
      Allocations or with special allocations of other items of income, gain, loss
      or
      deduction pursuant this subsection 9.1(h). Therefore, notwithstanding any other
      provision of Section 4 or this Section 9 (other than the Regulatory
      Allocations), the Manager shall make such offsetting special allocations of
      income, gain, loss or deduction in whatever manner they determine appropriate
      so
      that, after such offsetting allocations are made, each Member’s Capital Account
      Balance is, to the extent possible, equal to the Capital Account balance such
      Member would have had if the Regulatory Allocations were not part of this
      Agreement and all items were allocated pursuant to Section 4. In making any
      allocation under this subsection, the Manager shall take into account future
      Regulatory Allocations under subsection 9.1(a) and (b) that, although not yet
      made, are likely to offset other Regulatory Allocations previously made under
      subsections 9.1(f) and 9.1(g).

     

    9.2. Code
      Section 704(c).

     

    (a) In
      accordance with Code Section 704(c) and the Regulations thereunder, income,
      gain, loss and deduction with respect to any property contributed to the capital
      of the Company, solely for tax purposes, shall be allocated among the Members
      so
      as to take account of any variation between the adjusted basis of such property
      to the Company for Federal income tax purposes and its initial Gross Asset
      Value.

     

    (b) If
      the
      Gross Asset Value of any asset of the Company is revalued pursuant to Section
      1.8(r)(2), subsequent allocations of income, gain, loss and deduction with
      respect to such asset shall take account of any variation between the adjusted
      basis of such asset for federal income tax purposes and its Gross Asset Value
      in
      the same manner as under Code Section 704(c) and the Regulations
      thereunder.

     

    (c) Any
      elections or other decisions relating to allocations made under this Section
      9
      shall be made in any manner that reasonably reflects the purpose and intention
      of this Agreement. Allocations pursuant to this Section 9.2 are solely for
      income tax purposes and shall not affect, or in any way be taken into account
      in
      computing, any Person’s Capital Account or share of Profits, Losses, other items
      or distributions pursuant to any provision of this Agreement.

     

     

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

    

     

     

    (d) The
      provisions of this Section 9.2 are intended to comply with Code Section 704(c)
      and the Regulations promulgated thereunder. The Members shall make any
      modifications to this Agreement as may be required to comply with Section 704(c)
      and the Regulations thereunder.

     

    9.3. Other
      Allocation Rules.

     

    (a) Except
      as
      otherwise provided in this Agreement, items of income, gain, loss, deduction
      and
      credit shall be allocated among the Members for income tax purposes in a manner
      consistent with the allocations made for “book purposes” under Section 4 and
      this Section 9. Specifically, items of taxable income or loss corresponding
      to
      items which have been specially allocated pursuant to Section 9.1 shall be
      allocated for tax purposes in the same manner as those items are allocated
      for
      book purposes. Taxable income or loss for any Accounting Period which is not
      allocated pursuant to the preceding sentence and which is not otherwise
      allocated pursuant to Section 4 or this Section 9 shall be allocated among
      the
      Members for tax purposes in the same proportion that Profit or Loss has been
      allocated for that Accounting Period under Section 4.

     

    (b) For
      purposes of determining the Profits, Losses or any other items allocable to
      any
      Accounting Period, Profits, Losses and any such other items shall be determined
      on a daily, monthly or other basis, as determined by the Manager using any
      permissible method under Code Section 706 and the Regulations
      thereunder.

     

    (c) Except
      as
      otherwise provided in this Agreement, all items of income, gain, loss, deduction
      and any other allocations not otherwise provided for shall be divided among
      the
      Members in the same proportions as they share Profits or Losses, as the case
      may
      be, for the applicable Accounting Period.

     

    (d) Notwithstanding
      the other provisions of Section 4 or this Section 9, the Manager is authorized
      to make any adjustment in the allocation of Profits or Losses provided for
      in
      such Sections if the Manager considers in good faith that the adjustment is
      necessary and equitable to correct errors in allocations caused by errors in
      unaudited financial information or to correct inequities which may arise under
      this Agreement, including those which may result from there being multiple
      Accounting Periods during a single Fiscal Year or during the term of this
      Agreement rather than a single Accounting Period.

     

    (e) Solely
      for purposes of determining each Member’s share of “excess nonrecourse
      liabilities” of the Company, as such term is defined in Regulations Section
      1.752-3(a)(3), each Member’s Membership Interest in Profits for any Accounting
      Period shall be that Member’s Membership Interest in the Company for that
      Accounting Period.

     

    (f) To
      the
      extent permitted by Section 1.704-2(h)(3) of the Regulations, the Company shall
      endeavor to treat distributions as having been made from the proceeds of a
      Nonrecourse Liability or a Member Nonrecourse Debt only to the extent that
      such
      distributions would not cause or increase an Adjusted Capital Account Deficit
      for any Member.

     

    (g) To
      the
      extent an adjustment to the adjusted tax basis of any asset of the Company
      pursuant to Code Section 734(b) or Code Section 743(b) is required, pursuant
      to

     

     

    
      
        
        

      

      
        29

        
          

        

      

      
        
        

      

    

     

     

    Regulations
      Section 1.704-1(b)(2)(iv)(m)(2) or (4), to be taken into account in determining
      Capital Accounts as a result of a distribution to a Member in complete
      liquidation of its interest in the Company, the amount of such adjustment to
      the
      Capital Accounts of the Members shall be treated as an item of gain (if the
      adjustment increases the basis of the asset) or loss (if the adjustment
      decreases the basis of the asset) and such gain or loss shall be specially
      allocated to the members in accordance with their interests in the Company
      in
      the event Regulations Section 1.704-1(b)(2)(iv)(m)(2) applies, or to the Member
      to whom such distribution was made in the event Regulations Section
      1.704-1(b)(2)(iv)(m)(4) applies. 

     

    SECTION
      10. GENERAL
      PROVISIONS.

     

    10.1. Notices.
      Except
      as expressly provided in this Agreement, all notices, consents, waivers,
      requests or other instruments or communications given pursuant to this Agreement
      shall be in writing, signed by the party giving the same, and shall be delivered
      by hand or sent by registered or certified United States mail, return receipt
      requested, postage prepaid, or by a recognized overnight delivery service,
      addressed, in the case of the Company, to the Company at its principal place
      of
      business, and to any of the Members at the address set forth in the Company’s
      books and records. Any Member may, by notice to the Company and each other
      Member, specify any other address for the receipt of such notices, instruments
      or communications. Except as expressly provided in this Agreement, any notice,
      instrument or other communication shall be deemed properly given only when
      received, or upon refusal of receipt, by the Person to whom it is sent. The
      addresses of the Members are currently as follows:

     

    
       

          George
        Foreman ventures LLC                                
 
In
        Stride
        L.L.C.

          100
        North
        Wilkes-Barre Boulevard                                   
29
        Polhemus Drive

          4th
        Floor                                                Hillsborough,
        NJ
        08844

          Wilkes-Barre,
        PA 18702                                      
Attn:
        Dan
        Werremeyer

          Attn:
        Seymour
        Holtzman

       

          Olen
        Rice                                                Paul
        Koester

          c/o
        Northern
        Group                                          1301
        Armitage Avenue, Suite
        K

    

        926
      Willard
      Drive, Suite 144                                       
Melrose
      Park, IL
      60160

        Green
      Bay, WI
      54304

     

    10.2. Interpretation.

     

    (a) Section
      and subsection headings are not to be considered part of this Agreement, are
      included solely for convenience of reference and are not intended to be full
      or
      accurate descriptions of the contents thereof.

     

     

    
      
        
        

      

      
        30

        
          

        

      

      
        
        

      

    

     

     

    (b) Use
      of
      the terms “herein”, “hereunder”, “hereof” and like terms shall be deemed to
      refer to this entire Agreement and not merely to the particular provision in
      which the term is contained, unless the context clearly indicates
      otherwise.

     

    (c) Use
      of
      the word “including” or a like term shall be construed to mean “including but
      not limited to”.

     

    (d) Exhibits
      and schedules to this Agreement are an integral part of this
      Agreement.

     

    (e) Words
      importing a particular gender shall include every other gender and words
      importing the singular shall include the plural and vice-versa, unless the
      context clearly indicates otherwise.

     

    (f) Any
      reference to a provision of the Code, Regulations or the Act shall be construed
      to be a reference to any successor provision thereof.

     

    10.3. Independent
      Counsel.
      The
      Members recognize that the law firm of Riker, Danzig, Scherer, Hyland &
Perretti LLP has represented George Foreman Ventures with respect to the
      preparation and execution of this Agreement and that THE OTHER MEMBERS HAVE
      BEEN
      ADVISED TO RETAIN INDEPENDENT COUNSEL for advice regarding their rights and
      obligations under this Agreement. Each Member other than George Foreman Ventures
      represents that it has sought and obtained independent legal counsel or hereby
      waives the right to obtain such legal counsel. 

     

    10.4. Governing
      Law.
      This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of Delaware, excluding any conflict-of-laws rule or principle that might
      refer the governance, construction or interpretation of this Agreement to the
      laws of another State.

     

    10.5. Binding
      Agreement.
      This
      Agreement shall be binding upon and inure to the benefit of the Members and
      their respective heirs, executors, administrators, personal representatives
      and
      successors.

     

    10.6. Severability.
      Each
      term and provision of this Agreement is intended to be severable. If any term
      or
      provision of this Agreement is determined by a court of competent jurisdiction
      to be unenforceable for any reason whatsoever that term or provision shall
      be
      ineffectual and void and the validity of the remainder of this Agreement shall
      not be adversely affected thereby.

     

    10.7. Entire
      Agreement.
      This
      Agreement (including the exhibits and schedules hereto) supersedes any and
      all
      other understandings and agreements, either oral or in writing, between the
      Members with respect to the Membership Interests and constitute the sole and
      only agreement between the Members with respect to the Membership
      Interests.

     

    10.8. Further
      Action.
      Each
      Member and the Manager shall execute and deliver all papers, documents and
      instruments and perform all acts that are necessary or appropriate to implement
      the terms of this Agreement and the intent of the Members.

     

     

    
      
        
        

      

      
        31

        
          

        

      

      
        
        

      

    

     

     

    10.9. Power
      of Attorney.
      Each
      Member hereby irrevocably constitutes and appoints (a) the Manager, (b) each
      person who shall after the date of this Agreement become a Manager, and (c)
      any
      substitute that the Manager may appoint to act in its place (who need not be
      a
      Member) as his true and lawful representative and attorney-in-fact, with full
      power and authority in his name, place and stead, to make, execute, acknowledge,
      deliver, swear to, record, file and publish with respect to the Company (i)
      any
      and all instruments, documents and certificates (including the Certificate
      of
      Formation, any amendments thereto and a certificate of cancellation) which,
      from
      time to time, may be required by the laws of the United States of America,
      the
      State of Delaware or any other state in which the Company shall determine to
      do
      business or any political subdivision or agency thereof, and to take any other
      action which the Manager may deem necessary or appropriate, in his sole
      discretion, to execute, implement and continue or terminate the valid and
      subsisting existence and business operations of the Company and (ii) any
      amendments to and restatements of the Certificate of Formation as such
      amendments and restatements are contemplated hereunder, or any other instrument
      relating to any such amendments. The foregoing grant of authority is a special
      power of attorney coupled with an interest, shall be irrevocable and shall
      continue in full force and effect notwithstanding the subsequent death,
      disability, insanity or incapacity (or, in the case of a Member that is a
      corporation, limited liability company, association, partnership, joint venture
      or trust, the subsequent merger, dissolution or other termination of the
      existence) of such Member. The special power of attorney may be exercised on
      behalf of a Member by a facsimile signature of the Manager (or substitute for
      the Manager). The special power of attorney shall survive the Transfer by the
      Member of the whole or any portion of his Membership Interest, except that
      in a
      case in which the transferee of the whole Membership Interest of a Member shall
      have furnished a power of attorney and shall have been approved by the Manager
      for admission to the Company as a substituted Member, this power of attorney
      shall survive the Transfer for the sole purpose of enabling the Manager (or
      substitute for a Manager) to execute, acknowledge and file any instrument
      necessary to effect the substitution and shall thereafter
      terminate.

     

    10.10. Amendment
      or Modification.
      This
      Agreement (including the exhibits and schedules hereto) may be amended or
      modified from time to time only by the unanimous written consent of the Members;
      provided, however, that the Manager may amend or modify this Agreement
      (including the exhibits and schedules hereto) without the consent of any of
      the
      Members to reflect the issuance of any additional equity in the Company pursuant
      to the provisions of this Agreement. 

     

    10.11. Counterparts.
      This
      Agreement may be signed in counterparts, each of which shall be considered
      an
      original and together they shall constitute one instrument.

     

     

    (Signature
      page follows)

     

     

    
 

    
      
        
        

      

      
        32

        
          

        

      

      
        
        

      

    

     

     

    IN
      WITNESS WHEREOF,
      the
      Members have executed and adopted this Agreement effective as of April
      20,
      2007.

     

    WITNESS:                                                
GEORGE
      FOREMAN VENTURES LLC

    

    ______________________________                      
By:_______________________________________     

                            Name:

                            Title:
  

    

    

                           IN
      STRIDE
      L.L.C.

     

    _______________________________                               By:_____________________________________     

                                        
      Name:

                                        
      Title 

    

                                                     
      ___________________________________           

    _______________________________                                 
OLEN
      RICE

     

           

    _______________________________                               
      ________________________________________                       

                                                           PAUL
      KOESTER

     

     

     

    
 

    
      
        
        

      

      
        33

        
          

        

      

      
        
        

      

    

    

    SCHEDULE
      A

    

    MEMBERS;
      MEMBERSHIP INTERSTS; INITIAL CAPITAL CONTRIBUTIONS     

     

    

      
        	Member 	 	 	
                MembershipInterest 

              	 	 	 	 	 	
                Initial
                  Capital Contributions 

              	 
	
                 

                George
                  Foreman Ventures LLC

                 

              	 	 	
                
                

                50.1
                  %

                 

              	
                
                

                 

                
                

              	
                
                   

                

                
                

              	
                
                

                 

              	 	$	501 	 
	
                In
                  Stride L.L.C.

              	 	 	
                47.9
                  %

              	
                 

              	 	
                
                

                
                

              	 	
                
                  $

                

                
                

              	
                
                

                479

                
                

              	 
	
                 

                Olen
                  Rice

                 

              	 	 	
                
                

                1.0
                  %

                
                

              	
                
                

                 

                
                

              	
                
                   

                

                
                

              	
                
                

                 

                
                

              	 	$	10	 
	
                 

                Paul
                  Koester

                 

              	 	 	
                
                

                1.0
                  %

                
                

              	
                
                

                 

                
                

              	
                
                   

                

                
                

              	
                
                

                 

                
                

              	 	$	10	 

      

    

     

     

     

     

     

    
      
        
        

      

      
        34

        
          

        

      

      
        
        

      

    

     

     

    
 

     

    EXHIBIT
      A

     

     

    LICENSE
      AGREEMENT BETWEEN THE COMPANY AND IN STRIDE

     

     

     

     

     

    
      
        
        

      

      
        35

        
          

        

      

      
        
        

      

    

     

     

     

     

    EXHIBIT
      B

     

     

    LICENSE
      AGREEMENT BETWEEN THE COMPANY 

    AND
      GEORGE FOREMAN VENTURES

     

     

     

     

     

     

     

     

     

    

     

     

    

    36Exhibit 10.2 License Agreement

    
      

    

     

                                                                                                                Exhibiit
      10.2

     

    
 License
      Agreement

    

    

    This
      License Agreement (this "Agreement") is made as of April 20, 2007, between
      George Foreman Ventures LLC ("Licensor"), on the one hand, and InStride
      Ventures, LLC ("Licensee" and together with Licensor, the "Parties"), on the
      other hand. 

     

    Section
      1. Definitions.
      

     

    1.1 The
      Property: The name, image, signature, and likeness of the celebrity George
      Foreman (approved as herein provided). 

     

    1.2 The
      Articles: Shoes and inserts marketed to diabetics to treat and/or help relieve
      the complications caused by diabetes. 

     

    1.3 The
      Territory: United States and Canada.

     

    1.4 Advertising
      Materials: Any artwork, labeling, packaging, design, copy, text, and other
      promotional or advertising material of any sort, utilizing the Property.

     

    1.5 Products:
      Articles manufactured and sold utilizing the Property.

     

    Section
      2. Grant
      and Services.
      

     

     2.1  Licensee
      hereby acknowledges that Licensor entered into a Trademark License Agreement
      (the “Trademark License Agreement”) dated April 2, 2007 with George Foreman
      Productions, Inc. and George Foreman (collectively “Foreman”) to use the
      Property in connection with the manufacture, distribution, sale, advertising,
      promotion and other exploitation of the Products throughout the Territory.
      Licensee acknowledges and agrees that it shall have not have any greater rights
      than those granted to Licensor under the Trademark License Agreement.

     

    2.2  Licensor
      hereby grants to Licensee the non-exclusive license during the Term, to use
      the
      Property in connection with the manufacture, distribution, sale, advertising,
      promotion and other exploitation of the Products throughout the Territory.
      

     

    2.3 The
      term
      hereof shall be the period commencing on the date hereof and continuing for
      ten
      (10) years thereafter. Provided Licensor has received Five Million Dollars
      ($5,000,000) in its share of Retained Revenues as provided in Section 3 below
      during the initial ten (10) years, then Licensee shall have the right to extend
      the term for ten (10) additional consecutive years. The "Term" herein shall
      mean
      the initial ten (10) year period as same may be extended. 

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    Section
      3. Consideration.
      

     

    3.1 In
      consideration of the license granted herein, and provided Licensor is not in
      material breach hereof, Licensee shall pay to Licensor sums equal to five
      percent (5%) of Licensee's Retained Revenues derived from the sale of the
      Products hereunder. 

     

    3.2 For
      the
      purposes of this Agreement, "Retained Revenues" shall mean all monies actually
      received by Licensee from the sales of the Products, less all of the
      following:

     

    
      	(A)  	
              Shipping
                and handling charges actually paid by Licensee,
                and all sales taxes, use taxes, value added taxes, and any other
                non-income taxes imposed upon
                sales;

            

    

    
      	(B)  	
              refunds,
                credits or other allowances and/or discounts on account of return
                or
                rejection of goods or otherwise granted in the ordinary course of
                business, as actually incurred and as reserved for
                (“Returns”);

            

    

    
      	(C)  	
              uncollectible
                accounts due to credit card charge backs, bad checks or other reasons
                an
                account is uncollectible, as actually incurred and as reserved for
                (“Uncollectible Amounts”); 

            

    

    
      	 
              (D)  	
              sales
                made at or below Licensee’s cost of goods for purposes of liquidation or
                closeout; and

            

    

    
      	(E)  	
              all
                payments made to retailers associated with employee sales
                bonuses.

            

    

    

    3.3
      The
      reserve for Returns and Uncollectible Amounts shall initially be ten percent
      (10%), and shall be adjusted (and liquidated, if applicable) at the end of
      each
      calendar quarter to reflect actual returns and uncollectible
      amounts.

    

    3.4
      Licensee shall, within forty-five (45) days following the end of each calendar
      quarter, starting with the quarter in which sales of the Product commence,
      submit to Licensor an accounting statement covering the sales of the Product
      during the preceding quarter, and Licensee shall therewith transmit to Licensor
      payment of the amount due under this paragraph. Licensee agrees to keep full
      and
      accurate books of account respecting the sales of the Product hereunder.
      Licensee further gives Licensor the right, at its own expense, to examine said
      books and records on prior written notice of at least fourteen (14) days,
      insofar as they concern the sale of the Product hereunder and not more often
      than twice in any calendar year, for the purpose of verifying the accounting
      statements for no more than eight (8) accounting periods prior to such audit.
      Licensor may make such examination for a particular statement only once, and
      only within two (2) years after the date when Licensee sends Licensor the
      accounting statement pursuant to this paragraph. All statements rendered by
      Licensee to Licensor shall be binding upon Licensor and not subject to any
      objection by Licensor for any reason unless specific objection in writing,
      stating the basis thereof, is given to Licensee within two (2) years from the
      date rendered. Failure to make specific objection within said time period shall
      be deemed approval of such statement. Licensee will not have the right to bring
      an action against Licensee in connection with any statement or payment hereunder
      unless Licensor commences the suit within six (6) months from the date such
      written objection, if any, is so given. If the examination

     

     

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

     

    by
      Licensor discloses a discrepancy of five percent (5%) or between the amount
      actually paid to Licensor and the amount that should have been paid to Licensor,
      then Licensee shall reimburse Licensor for the actual out-of-pocket cost of
      the
      examination. 

     

    Section
      4. Compliance. The
      Products shall be manufactured in compliance with the following:

    

    
      
        
          	
                	4.1	
                  All
                    requirements of the Fair Labor Standards Act, as amended (the
AFLSA),
                    and all regulations and orders of the U.S. Department of Labor
                    issued in
                    accordance thereof; 

                

        

      

    

    

    
      	
            	4.2	
              State
                and local laws pertaining to child labor, minimum wage and overtime
                compensation; and 

            

    

    

    
      	
            	4.3	
              With
                respect to Products (including components thereof) manufactured outside
                the United States, the wage and hour laws of the country of manufacture
                and without the use of child, prison or slave labor.
                

            

    

    

    
      	
              Section 5.  
                

            	
              Representations
                and Warranties.

            

    

    

    5.1 Licensor
      expressly represents and warrants that it has the right to grant the rights
      herein granted to Licensee without violating the legal or equitable rights
      of
      any third party. 

    

    5.2 Licensee
      represents and warrants that it is fully authorized to enter into and perform
      this Agreement. 

    

    5.3 Licensor
      and Licensee agree to defend, indemnify and hold each other harmless against
      any
      and all loss, damage and expense, including attorneys fees and costs arising
      out
      of any claims that may be instituted against them by reason of any breach or
      alleged breach of their respective warranties, representations or agreements
      hereunder.  

     

    5.4 The
      provisions of this paragraph shall survive the expiration or termination of
      this
      Agreement. 

    

    Section
      6. Termination.

    

    6.1 If
      Licensee shall at any time breach any of its material obligations hereunder
      and
      Licensee shall fail to commence to remedy such default within thirty (30) days
      after written notice thereof by Licensor, then Licensor may, at its option,
      terminate this Agreement and the license granted herein by notice to that
      effect. 

    

    6.2 Nothing
      in this Agreement will be construed to require Licensee to transfer to Licensor
      any trademarks and/or copyrights in the Products, Advertising Materials and/or
      any artwork and/or material used in connection with the Products, and/or any
      materials which were not supplied by Licensor hereunder, and all such materials
      shall remain the sole property of Licensee. Excluding the Property, any and
      all
      trademarks, trade names, slogans, designs, copyrights and methods used in or
      in
      connection with the manufacture, sale or advertisement of

     

     

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

     

    the
      Products, shall notwithstanding the termination or expiration of this Agreement,
      be and remain the sole property of Licensee.

    

    6.3
      Notwithstanding any other provision of this Agreement, the License granted
      herein shall terminate if Licensee does not actively use the Property in
      connection with the manufacture, distribution, sale, advertising, promotion,
      or
      other exploitation of the Products in any period of eight (8) consecutive months
      or for twenty four (24) total months (not necessarily consecutive) in the
      initial ten year Term. 

    

    Section
      7. Miscellaneous.
      

     

    7.1 This
      Agreement may be executed in several counterparts, each of which will be deemed
      an original but all of which will constitute one and the same.

     

    7.2 This
      Agreement supersedes
      any and all other agreements, either oral or written, between such parties
      with
      respect to the subject matter hereof.

     

    7.3 Wherever
      possible, each provision hereof shall be interpreted in such manner as to be
      effective and valid under applicable law, but in case any one or more of the
      provisions contained herein shall, for any reason, be held to be invalid,
      illegal or unenforceable in any respect, such provision shall be ineffective
      to
      the extent, but only to the extent, of such invalidity, illegality or
      unenforceability without invalidating the remainder of such invalid, illegal
      or
      unenforceable provision or provisions or any other provisions hereof, unless
      such a construction would be unreasonable.

     

    7.4 Licensor
      agrees that during the Term of this Agreement, it shall not use, nor shall
      it
      permit any other person/entity to use, the Property to manufacture, promote,
      distribute, market, advertise and/or sell shoes and/or inserts marketed to
      diabetics to help treat/relieve complications caused by diabetes.

     

    7.5 This
      Agreement may be amended only by a written agreement executed by both
      Parties.

     

    7.6 This
      Agreement may be assigned by Licensee and will be binding upon and shall inure
      to the benefit of the parties, and their respective successors and assigns.
      Licensee may enter into agreement(s) with third parties to license the rights
      and obligations granted to it under this Agreement.

     

    7.7 This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of New York applicable to contracts made and to be wholly performed
      therein. The Parties hereby consent to the exclusive venue and personal
      jurisdiction in the Supreme Court of the State of New York or any United States
      District Court within the State of New York and courts with appellate
      jurisdiction therefrom.

     

    7.8 Nothing
      contained herein shall constitute this arrangement to be employment, a joint
      venture or a partnership.

     

     

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

     

    7.9 The
      failure of either Party to exercise in any respect any right provided for herein
      shall not be deemed a waiver of any right hereunder. The headings of sections
      and other subdivisions of this Agreement are for convenient reference only,
      and
      shall not be used in any way to govern, limit, modify or construe this Agreement
      or otherwise be given any legal effect.

     

    7.10 All
      notices hereunder shall be in writing at the addresses below and shall be given
      by certified mail, return receipt requested, or by facsimile transfer with
      a
      confirmation copy sent by regular first class mail.

     

    Licensor: c/o
      Jewelcor Companies, 100 North Wilkes-Barre Blvd., 4th
      Floor,
      Wlikes-Barre, PA 18702, Attention: Richard L. Huffsmith, Esq.

     

    Licensee: 100
      North
      Wilkes-Barre Blvd., 4th Floor, Wilkes-Barre, PA 18702, attention: Efrem
      Gerszberg and Jeremy Anderson.

     

    

     

    IN
      WITNESS WHEREOF, the Parties have duly executed this License Agreement as of
      the
      date set forth above.

    

    

    

    GEORGE
      FOREMAN VENTURES, LLC.

    

    By:
      ____________________________      

    Name:__________________________       

    Title:___________________________       

    

    

    

    INSTRIDE
      VENTURES, LLC

    

    By:_____________________________
            

    Name:___________________________
            

    Title:____________________________
            

    

     

     

     

    5

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