Document:

tristar_ex101.htm

EXHIBIT 10.1

 

ASSET PURCHASE AGREEMENT

This ASSET PURCHASE AGREEMENT (the “Agreement”) is made and entered into as of 12:01 a.m. on February 4, 2013 (the “Effective Time”), by and between Tristar Wellness Solutions, Inc., a Nevada corporation maintaining an address at 10 Saugatuck Ave., Westport, Connecticut 06880 (“TWS”) and TriStar Consumer Products, Inc., a Nevada corporation and a subsidiary of TWS (the “Purchaser”), on the one hand, and NorthStar Consumer Products, LLC, a Connecticut limited liability company maintaining business offices at 10 Saugatuck Ave, Westport CT 06880 (“NCP”),  and John Linderman and James Barickman, individuals (the “Shareholders”) (hereinafter NCP and the Shareholders are sometimes referred to, individually as a “Seller Party” and collectively as the “Sellers” or the “Seller Parties”), on the other hand.

 

BACKGROUND INFORMATION

 

WHEREAS, NCP are in the business of developing and selling health and beauty products. Currently NCP owns a brand of skincare and other products specifically targeted for pregnant women.  In addition NCP own a formula being developed for OTC itch suppression. Collectively these product lines represent the “Business”, and the Shareholders are the owners of all of the capital stock in Sellers.  This Agreement sets forth the terms and conditions upon which Purchaser is acquiring from Seller, and Seller is selling and delivering to Purchaser, certain assets of the Business.

WHEREAS, TWS and NCP are parties to that certain License and Asset Purchase Option Agreement dated June 25, 2012 (the “License Agreement”), under with TWS has the option to purchase the Business from NCP upon certain conditions being satisfied.

WHEREAS, the conditions to be satisfied under the License Agreement are set forth below, and the Purchaser and the Seller Parties wish to consummate the transaction whereby the Seller Parties will sell the Business, and all related assets, to the Purchaser.

OPERATIVE PROVISIONS

In consideration of the mutual covenants and conditions hereinafter set forth, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller, the Shareholder and Purchaser hereby mutually agree as follows:

1. SALE AND TRANSFER OF ASSETS; CLOSING.

1.1. Purchase Option Conditions.  Under the License Agreement, upon the following conditions being met, TWS had an irrevocable option to purchase all NCP’s right, title, and interest on an “As Is” basis in the assets set below, which TWS could exercise upon all of the following conditions being met:

 

  

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(i) TWS must be a fully reporting company under the Securities Exchange Act of 1934, as amended (the “’34 Act”), and be current in its reporting obligations under the ’34 Act, on a basis reasonably acceptable to the Sellers;

(ii) There must be mutually-agreed written employment agreements in place, to be effective upon TWS closing the purchase of the Assets, hiring John Linderman as President and Chief Executive Officer and James Barickman as Chief Marketing Officer of TWS;

(iii) TWS must be in a position to support the marketing and other operational needs of the Business, and to otherwise meet its financial obligations as they become due and not be delinquent in any outstanding payment obligations;

(iv) TWS shall have fully assumed the obligations for the “Product Line Payment” under the contract described on Schedule 3.4 to the License Agreement with respect to a sale of the Beaute de Maman business, on a basis mutually acceptable to the Parties and to the seller of the Beaute de Maman business, and without liability or obligation of NCP; and

 

(v) There shall be no litigation or inquiry, investigation or proceeding (whether preliminary, formal or informal) by any governmental unit, agency or regulatory body (or SRO), or by any current or former TWS stockholder or TWS or Purchaser creditor, that is pending or overtly threatened against the Purchaser or TWS, including without limitation, no litigation, inquiry, investigation or proceeding with respect to TWS’s securities issuances and/or ’34 Act filings, or seeking to delist or remove TWS from the OTC Markets (Pink Sheets).

1.2. Exercise of Purchase Option.  This Agreement evidences TWS’s exercise of the option to purchase the Business set forth in the License Agreement.  Regarding the above conditions:  (i) has been met by TWS, (ii) will be put in place at closing of the transaction contemplated hereby, (iii) has not been met but additional provisions have been agreed to between the parties to cover NCP in the event NCP must pay a TWS obligation related to the Business (see Section 5.3); (iv) must work out acceptable terms with Ms. Brown pre-Closing or TWS must indemnify NCP for any payments it makes to Ms. Brown related to the Business (see Section 5.3), and (v) has been met.

1.3. Assets.  Upon the terms and subject to the conditions set forth in this Agreement, at the Closing (hereinafter defined), the Sellers shall sell, convey, assign, transfer and deliver to Purchaser, and Purchaser shall purchase and acquire from Sellers, all of Sellers’ right, title, and interest in and to certain of Sellers’ property and assets, real, personal or mixed, tangible and intangible, of every kind and description, wherever located as specifically set forth on Exhibit A (the “Assets”), but excluding the Excluded Assets (hereinafter defined).  All of the Assets relate to the Business and do not relate to any other assets or business of NCP.

1.4. Excluded Assets.  Notwithstanding anything to the contrary contained in Section 1.1 or elsewhere in this Agreement, the following assets of Sellers (collectively, the “Excluded Assets”) are not part of the sale and purchase contemplated hereunder, are excluded from the Assets and shall remain the property of Sellers after the Effective Time.

 

  

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1.4.1 all minute books, stock records and corporate seals;

1.4.2 any equity securities of Seller held in treasury;

1.4.3 all personnel records and other records that Seller is required by law to retain in its possession;

1.4.4 all rights in connection with and assets of any employee benefit plans maintained by Seller;

1.4.5 cash and bank deposits of Sellers as of the Effective Time;

1.4.6 all rights of Sellers under this Agreement;

1.4.7 all assets, if any, specifically set forth on Schedule 1.2; and

 

1.4.8 any other assets of NCP not related to the Business.

1.5. Consideration.  The consideration for the purchase of the Assets (the “Purchase Price”) will be Seven Hundred Fifty Thousand (750,000) shares of TWS’s Series D Convertible Preferred Stock (the “Shares”), put in the name(s) as instructed by NCP.

1.6. Liabilities.  At the Closing, Purchaser shall assume and agree to discharge only the obligations of Sellers set forth in Exhibit B (the “Assumed Liabilities”).  Except for the Assumed Liabilities, Purchaser shall not assume any Liabilities of Sellers or the Shareholders; and Sellers shall pay, perform and discharge all of such Liabilities in accordance with their terms.  For purposes of this Agreement, the term “Liabilities” means any existing or future liability, obligation, debt, account payable, lease obligation, contract, agreement, duty or commitment of Sellers or Shareholders of any kind, character or description, whether known or unknown, absolute or contingent, accrued or unaccrued, disputed or undisputed, liquidated or unliquidated, secured or unsecured, joint or several, due or to become due, vested or unvested, executory, determined, determinable or otherwise, and whether or not the same is required to be accrued on the financial statements of Sellers or the Shareholders.

1.7. Closing.  The closing (the “Closing”) of the transactions contemplated by this Agreement (the “Contemplated Transactions”) shall take place at the offices of the Purchaser on February 4, 2013, (the “Closing Date”) or at such other time and place as the parties shall agree.  At the Closing the parties shall deliver the following documents:

1.7.1 Selling Parties’ Deliveries at the Closing.  Sellers shall deliver to Purchaser at the Closing the following items:

	
(i)  

	
a Bill of Sale from Sellers to Purchaser in form and substance acceptable to Purchaser;

	
(ii)  

	
a copy of the resolutions duly adopted by Sellers’ Boards of Directors and Shareholders authorizing the execution, delivery, and performance of this Agreement and the consummation of the Contemplated Transactions, certified by an officer of Sellers;

	
(iii)  

	
unaudited financial statements and management reports for December 31, 2010 and December 31, 2011, and each subsequent calendar quarter starting with March 31, 2012;

	
(iv)  

	
evidence that any and all security interests covering the Assets have been released by Sellers’ lenders or transferred to Purchaser; and

	
(v)  

	
all other documents or instruments required by this Agreement or reasonably required by Purchaser’s counsel to consummate the Contemplated Transactions.

 

  

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1.7.2 Purchaser’s Deliveries at the Closing.  At the Closing, or as otherwise set forth below, Purchaser shall deliver the following:

 

1.7.2.1 Purchaser shall deliver to Sellers:

 

(i) a copy of the resolutions duly adopted by the Board of Directors of Purchaser authorizing the execution, delivery, and performance of this Agreement and the consummation of the Contemplated Transactions, certified by an officer of Purchaser; and

 

(ii) all other documents or instruments required by this Agreement or reasonably required by Sellers’ counsel to consummate the Contemplated Transactions.

2. REPRESENTATIONS AND WARRANTIES OF THE SELLER PARTIES.

 

The Seller Parties, jointly and severally, represent and warrant to Purchaser as follows, which representations and warranties shall survive the consummation of the Contemplated Transactions:

2.1. Organization; Power; Authority.  NCP is a limited liability company duly organized, validly existing, and in good standing under the laws of the State of Connecticut, with full power and authority to carry on the Business as now being conducted and to own, operate and lease (as the case may be) the Assets and to perform all of its obligations.  Sellers have the corporate power and authority to sell, assign, transfer, convey and deliver to Purchaser the Assets as contemplated by this Agreement, and the execution, delivery and performance of this Agreement and the Contemplated Transactions have been properly and duly authorized by Sellers.  Shareholders have the authority to enter into this Agreement and consummate the Contemplated Transactions.  This Agreement and all other agreements executed in connection with the Contemplated Transactions constitute, or will constitute upon execution, the legal, valid and binding obligations of Sellers and Shareholders, enforceable in accordance with their respective terms.

2.2. No Conflict or Violation; Approvals.  The execution, delivery and performance of this Agreement and the Contemplated Transactions will not (a) violate or conflict with Sellers’ articles of organization or operating agreements; (b) cause a breach of, or a default under, or create any right for any party to accelerate, terminate, modify or require notice under or cancel, any contract, permit, authorization or concession that Sellers or the Shareholders is a party or by which any of the Assets are bound; (c) violate by Sellers or Shareholders any law, rule, regulation, constitution, injunction, judgment, order, decree, ruling or other restriction of any government, government agency or court; or (d) impose any encumbrance, restriction or charge on the Business or on any of the Assets.  No consent, approval or authorization of, or declaration, filing or registration with, any authority, or any other person or entity, is required to be made or obtained by Sellers or Shareholders in connection with the execution, delivery and performance of the Agreement and the Contemplated Transactions, except as have been received by Sellers or Shareholders prior to the Closing.

 

  

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2.3. Capitalization.  The Seller Parties own 100% of the outstanding capital stock of Sellers free and clear of all encumbrances.  No other person has a contract right, whether by issuance, sale, transfer, or otherwise to any capital stock of Sellers.  NCP has no subsidiaries.

2.4. Financial Statements.  Sellers have delivered to the Purchaser complete and correct copies of unaudited financial statements of Seller for the periods ended as of December 31, 2010 and December 31, 2011, and the three and nine months ended September 30, 2012 (the “Financial Statements”).  The Financial Statements were prepared in accordance with GAAP consistently applied throughout the periods indicated; are consistent with the books and records of the Business; and present fairly the financial condition and results of operations of the Business as of the date thereof and the period then ended.  There has not been any change in the assets, liabilities, financial condition or operations of Sellers from that reflected in the Financial Statements for the period ending as of the Closing Date, except changes in the ordinary course of business that have not been, individually or in the aggregate, materially adverse.  Except to the extent reflected or reserved against or noted in the Financial Statements, Sellers have, as of the date thereof, no material liabilities or obligations of any nature, whether accrued, absolute, contingent or otherwise, including without limitation tax liabilities, whether incurred in respect to or measured by Sellers’ income for any period prior to the date of such Financial Statements, or arising out of transactions entered into, or any set of facts existing prior thereto.  There exists no basis for the assertion against Sellers or the Business as of the date hereof or as of the date of the Financial Statements, of any material liability of any nature or in any amount not fully reflected or reserved against or noted in the Financial Statements.

2.5. Title.  Sellers have good and marketable title to all of the Assets, free and clear of all liens, assignments, security interests, claims, mortgages, encumbrances or charges of any kind or nature (“Liens”).  As of the Closing Date, Purchaser shall acquire good and marketable title to all of the Assets free and clear of all Liens, except those set forth in Exhibit B.  The Assets constitute all of the assets (tangible and intangible, and including, but not limited to, all intellectual property assets) necessary to operate the Business in the manner presently operated by Sellers and each of the Assets is in good operating condition and repair, normal wear and tear excepted.  Without limitation the Assets include all of Sellers’ right, title, and interest in and to the following (in each case except for the Excluded Assets), wherever located:

2.5.1 All of Sellers’ office equipment and furniture (collectively, the “Equipment”), including, without limitation, the Equipment disclosed in Exhibit A.

2.5.2 All inventories of Sellers and all goods and supplies, in each case to the extent used directly or indirectly in or otherwise relating primarily to the Business (the “Inventory”).  All items included in the Inventory consist of a quality and quantity usable and, with respect to finished goods, saleable, in the ordinary course of business of Seller except for obsolete items and items of below-standard quality, all of which have been written off or written down to net realizable value in the Financial Statements, as the case may be.

2.6 Material Contracts.  Other than as set forth in Schedule 2.6, Sellers are not parties to any contract related to the Business under which Sellers paid (a) $10,000 or more during the 12 month period ending December 31, 2011, (b) received $10,000 or more during the 12 month period ending December 31, 2011, or (c) would, absent this Agreement and the Contemplated Transactions, reasonably expect to pay or receive $10,000 or more for the 12 month period immediately following the Closing Date.  Neither NCP nor the Shareholders are subject to any contract: (i) that contains covenants limiting the freedom of Sellers or the Shareholders to compete in any line of business in any geographic area; (ii) that requires Sellers to share any profits, or requires any payments or other distributions based on profits, revenues or cash flows; (iii) pursuant to which third parties have been provided with products that can be returned to Sellers in the event they are not sold and which could involve products valued at $10,000 or more (invoice price) in the aggregate; or (iv) that has had or, assuming that Purchaser complies with its obligations thereunder, may in the future have a material adverse effect upon the business, earnings, financial condition, or prospects of Purchaser.

 

  

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2.7 Litigation.  There are no claims, actions, suits, proceedings or investigations pending or, to the knowledge of the Seller Parties, threatened against or affecting the Assets or the operation of the Business before any foreign, federal, state, local or other governmental authority or agency, or involving any private parties.

 

2.8 Compliance with Laws.  The operation of the Business and the Assets conform to the requirements of all applicable laws, rules, orders, ordinances, decrees and regulations of all governmental agencies, whether national, state or local, having jurisdiction there-over, and no material claim alleging nonconformity or noncompliance with respect to such matters has been made or threatened against Sellers and/or the Assets or, to Sellers’ Parties knowledge, may in the foreseeable future be made by any such agency.

2.9 Employee Benefit Plans.  Sellers have no formal or informal health, dental, vision, life, retirement, profit sharing, deferred compensation, pension, stock options, sick leave or sick time employee benefit plans in effect.

2.10 Employee Matters.

2.10.1  List of Personnel.  Schedule 2.10.1 contains a true and complete list of the names and current compensation levels of all active employees involved in the Business as of the date hereof.  Since December 31, 2011, there has been no increase in the compensation of the employees of Seller.

2.10.2 Employee Relations.  There is no labor strike, dispute, slowdown, stoppage, similar activity pending or, to the knowledge of the Seller Parties, threatened against Sellers pertaining to the Business or the employees involved in the Business.  There are no charges, investigations, administrative proceedings, or formal complaints of discrimination (including discrimination based upon sex, age, marital status, race, national origin, sexual preference, handicap or veteran status) pending or, to the knowledge of the Seller Parties, threatened before the Equal Employment Opportunity Commission or any federal, state, or local agency or court against Sellers or the Shareholders pertaining to the Business or the employees of the Business, and, to the knowledge of the Seller Parties, no basis for any such charge, investigation, administrative proceeding, or complaint exists.

2.10.3 No Liabilities or Obligations.  Except as reflected on the Financial Statements Sellers have no liabilities or obligations to any beneficiaries, governmental authorities, or any other parties arising out of or relating to any employee claims.

2.10.4 Worker’s Compensation Insurance Coverage and Claims.. Sellers have in full force and effect worker’s compensation coverage in each jurisdiction in which Sellers are required to maintain such coverage by applicable state law.  Sellers have paid or accrued all workers’ compensation premiums required to be paid in each jurisdiction in which Seller is required to maintain such coverage by applicable state law.

2.11 Taxes.  The Seller Parties have filed all required tax returns in connection with the Assets and the operation of the Business.  All tax returns filed by Sellers or the Shareholders in connection with the Assets and the operation of the Business are true, correct, and complete.  The Seller Parties have paid, or made provision for the payment of, all taxes that have or may have become due pursuant to tax returns that are or were required to be filed by Sellers or the Shareholders in connection with the Assets and the operation of the Business, or pursuant to any assessment received by Sellers or the Shareholders.  There exists no proposed tax assessment against Sellers or any shareholder of NCP in connection with the Assets and the operation of the Business. All taxes that Sellers or the Shareholders are required to withhold or collect in connection with the operation of the Assets and the Business have been duly withheld or collected and, to the extent required, have been paid to the proper governmental body or other person.

 

  

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2.12 Environmental Matters.  Sellers have duly complied with, and the Business and all Assets are in compliance in all Environmental Laws (hereinafter defined); there have been no citations, notices or orders of noncompliance issued to Sellers under any such Environmental Laws.  For the purposes of this Agreement, “Environmental Law” means any applicable law, order, regulation, decree, permit, license, ordinance or other federal. State, county, provincial, local or foreign governmental requirements in effect as of the Closing Date relating to pollution, the protection of human health and the environment, or the spill of any hazardous substance in the environment.  Environmental laws include, but are not limited to, the following statutes (and their implementing regulations);Comprehensive Environmental Response, compensation and Liability Act (42 U.S.C. 9601, et seq.), the Resource Conservation and Recovery Act (42 U.S.C. 6901, et seq.), the Federal Water Pollution Control Act (33 U.S.C. 1251, et seq.), the clean Air Act (42 U.S.C. 7401, et seq.), the Toxic Substance Control Act (15 U.S.C. 2601, et seq.), the Emergency Planning Community Right to Know Act (42 U.S.C. 11001, et seq.), and the Occupational Safety and Health Act of 1970. “Hazardous Substance” means any petroleum, petroleum by-products, polychlorinated biphenyl and any other chemicals, materials, substances or wastes which are currently defined or regulated as "hazardous substances, "hazardous materials,"  "hazardous wastes," "extremely hazardous wastes,"  "restricted hazardous wasted," "toxic substances," "toxic pollutants," "toxic air pollutants," "hazardous air pollutants," "pollutants," or "contaminants" under any Environmental Law.

2.13 Broker’s or Finder’s Fees.  None of the Seller Parties has incurred, nor will any of them incur, directly or indirectly, any liability for brokerage or finders’ fees or any similar charges in connection with this Agreement or the Contemplated Transactions.

 

2.14 Material Misstatements or Omissions.  No representations or warranties by the Seller Parties in this Agreement, nor any document, exhibit, statement, certificate or schedule furnished to Purchaser pursuant hereto, contains, or with respect to other documents to be delivered by the Seller Parties at Closing, will contain any untrue statement of a material fact, or omits to state any material fact necessary to make the statements or facts contained therein not misleading.

2.15 Information; Suitability.  The Seller Parties, along with their advisors have such knowledge and experience in financial and business matters that the Seller Parties are capable of evaluating the merits and risks of the Purchase Price consideration and the Contemplated Transactions.  The Seller Parties are aware that The Lebrecht Group has represented only the interests of TWS and the Purchaser in connection with this Agreement and the Contemplated Transactions and the Seller Parties have sought such accounting, legal and tax advice as the Seller Parties have considered necessary to make an informed decision with respect to the Contemplated Transactions and have determined that the Purchase Price Consideration and other terms and conditions of the Contemplated Transaction are fair and reasonable to the Seller Parties.

2.16 Intention.  The Seller Parties have not entered into this Agreement or agreed to complete the Contemplated Transactions with the actual intent to hinder, delay, or defraud any creditor of the Seller Parties.

2.17 Value of Assets.  The Seller Parties have received reasonably equivalent value in exchange for the obligations to be undertaken pursuant to the Contemplated Transactions.  Giving effect to the Contemplated Transactions, the fair market value of the Business’ assets exceeds the Business’ total liabilities, whether accrued, absolute, contingent or otherwise.  NCP’s assets do not and, immediately following the Contemplated Transactions, will not, constitute unreasonably small capital to carry out NCP’s business as conducted or as proposed to be conducted.

 

  

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2.18 No Bankruptcy.  No petition in bankruptcy has been filed against either NCP or the Shareholders or any affiliate of either of them during the last seven years, and neither NCP, the Shareholders nor any affiliate of either of them in the last seven years has ever made an assignment for the benefit of creditors or taken advantage of any insolvency act for the benefit of debtors.  Neither the Seller Parties nor any affiliate of the Seller Parties is contemplating the filing of a petition under any state or federal bankruptcy or insolvency laws.  None of the Seller Parties has any knowledge of any person contemplating the filing of any such petition against it or an affiliate of the Seller Parties.

2.19 Restricted Shares.  Sellers and Shareholders acknowledge that the Shares are restricted securities under Rule 144 of the Securities Act of 1933, and, therefore, when issued by the Purchaser will contain a restrictive legend substantially similar to the following:

 

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”).  THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER THE ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.

2.20 Preferred Stock.  Sellers and Shareholders are aware the Shares are Series D Convertible Preferred Stock of TWS and are aware of the terms of such Series D Convertible Preferred Stock and have reviewed the Certificate of Designation that sets forth the terms of the Series D Convertible Preferred Stock.

 

3. REPRESENTATIONS AND WARRANTIES OF PURCHASER.  Purchaser represents and warrants to the Seller Parties as follows:

 

3.1 Organization and Power.  Purchaser is a duly organized and validly existing Nevada corporation, and is a wholly-owned subsidiary of TWS.  Purchaser has the power and authority to carry on its business as now being conducted and to own, operate and lease its properties in the places where such business is now conducted and where such properties are now owned, leased or operated.

3.2 Authorization.  The execution, delivery and performance of this Agreement by Purchaser and the consummation of the Contemplated Transactions by the Purchaser have been duly authorized by the Purchaser.  This Agreement constitutes the legal, valid and binding obligation of Purchaser, enforceable in accordance with its terms.

3.3 Broker’s or Finder’s Fees.  Purchaser has not incurred, nor will it incur, directly or indirectly, any liability for brokerage or finders’ fees or any similar charges in connection with this Agreement or the Contemplated Transactions.

4. COVENANTS.

4.1 Funds Received After Closing.  Any and all funds received by Sellers after the Closing in respect of the Business, other than amounts received in respect of the Excluded Assets, shall be remitted to the Purchaser immediately upon receipt.  Any and all funds received by the Purchaser after Closing in respect of the Excluded Assets shall be remitted to NCP  immediately upon receipt.

 

  

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4.2 Liabilities.  All liabilities with respect to the operation of the Business not otherwise provided for herein which are paid or become payable after the Closing (hereinafter defined) shall be allocated between Purchaser and Sellers according to the accounting period to which they relate.  Items relating to a time prior to the Closing Date shall be paid by Seller and those relating to a time thereafter shall be paid by Purchaser.  Obligations for taxes, rent, utilities, telephone service and other items which relate to a period prior to and after the Closing Date, will be prorated as of the Closing Date between Purchaser and Seller and adjusted between the parties as soon as possible after the invoices therefore are received.

4.3 Certain Employment Related Matters.  Prior to the Closing, Sellers will terminate all of its employees and Purchaser shall have the right, but not the obligation, to hire any or all of such employees.  Each such Employee that Purchaser elects to employ shall be employed by the Purchaser on an “at-will” basis and may be terminated at any time with or without cause.

4.4 Tax Matters.

4.4.1 The Seller Parties shall pay all taxes of whatsoever kind or nature imposed by the United States or by any state, municipality, subdivision or instrumentality of the United States or by any other tax authority (including all applicable penalties and interest, "Taxes") arising from or relating to the Contemplated Transactions if any, due as a result of the purchase, sale or transfer of the Assets in accordance herewith whether imposed by law on the Seller Parties or the Purchaser, and the Seller Parties shall indemnify, reimburse and hold harmless the Purchaser in respect of the liability for payment of or failure to pay any such Taxes or the filing of or failure to file any reports required in connection therewith.

4.4.2 The Seller Parties on the one hand, and Purchaser, on the other hand, agree to furnish or cause to be furnished to each other, upon request, such information and assistance (including access to books and records) relating to Seller and the Purchaser as is reasonably necessary for the preparation of any return, claim for refund or audit, and the prosecution or defense of any claim, suit or proceeding relating to any proposed adjustment.

5. INDEMNIFICATION.

5.1 Survival of Representations.  Each representation, warranty, covenant and agreement made by any party within this Agreement or pursuant hereto shall survive the Closing forever.  All statements contained herein and in any certificate, schedule, list and other document described pursuant hereto or in connection with the transactions contemplated hereby shall be deemed representations and warranties within the meaning of this Section.

 

5.2 Indemnification Of Purchaser.  Sellers and the Shareholders, jointly and severally, shall indemnify and hold harmless Purchaser against and in respect of all demands, claims, actions, liabilities, damages, losses, judgments, assessments, costs and expenses (including without limitation interest, penalties and attorney fees) (individually a “Claim” and collectively the “Claims”) asserted against, resulting to, imposed upon or incurred by Purchaser, directly or indirectly, and arising out of or resulting from (a) a breach of any representation, warranty, covenant or agreement made or to be performed by Sellers or the Shareholders under this Agreement, (b) any requirement that Purchaser satisfy or perform any Liability of Sellers or the Shareholders that is not an Assumed Liability, (c) any fraud or willful misconduct by NCP or the Shareholders in connection with this Agreement or the Contemplated Transactions or (d) the conduct of the Business prior to the Closing Date.

 

  

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5.3 Indemnification of Sellers.  Purchaser shall indemnify and repay the Sellers for any amounts they are made to pay as a result of the Purchaser not meeting its obligations regarding the Business (as set forth in Section 1.1(iii)) or towards Ms. Brown (as set forth in Section 1.1(iv)) (individually a “Claim” and collectively the “Claims”).

5.4 Notification  Any party seeking indemnification hereunder shall hereinafter be referred to as the “Indemnified Party” and the other party shall hereinafter be referred to as the “Indemnifying Parties.”  The Indemnified Party shall, upon becoming aware or being put on notice of the existence of a Claim with respect to which the Indemnified Parties may be entitled to indemnification pursuant to this Section 5, promptly notify the Indemnifying Parties in writing of such matter.  The failure of the Indemnified Party to notify the Indemnifying Parties of any Claim with respect to which the Indemnified Party may be entitled to indemnification hereunder will not relieve the Indemnifying Parties of any liability that it may have to the Indemnified Party except to the extent the Indemnifying Parties are materially prejudiced thereby.

5.5 Settlement and Defense of Claims.  Except as hereinafter provided, upon receiving notice thereof in accordance with the provisions of Section 5.4 hereof, the Indemnifying Parties shall have the right to settle at its own cost and expense all Claims which are susceptible of being settled or defended, and to defend, through counsel of its own choosing and at its own cost and expense, any third party action which may be brought in connection therewith; provided, that the Indemnifying Parties shall be required to keep the Indemnified Party fully and currently informed of all settlement negotiations and of the progress of any litigation; and provided further that the Indemnified Party shall have the right to fully participate in the defense or settlement of any Claim at its own expense, except for its reasonable attorney’s fees which shall be paid by the Indemnifying Parties, if a third legal counsel chosen by the legal counsel of the Indemnified Party determines that: (a) there are or may be legal defenses available to such Indemnified Party that are different from or additional to those available to Indemnifying Parties and which could not be adequately advanced by counsel chosen by the Indemnified Party, or (b) a conflict or potential conflict exists between Indemnifying Parties and such Indemnified Party that would make such separate representation advisable.  The Indemnifying Parties shall not, without the prior written consent of the Indemnified Party, which consent shall not unreasonably be withheld, settle or compromise or consent to the entry of any judgment in any pending or the threatened claim, action or proceeding to which such Indemnified Party is a party.

5.6 Cooperation of Indemnified Party.  The Indemnified Party shall cooperate with the Indemnifying Parties in connection with the settlement or defense of any Claim.  In addition, except as hereinafter provided, the Indemnified Party shall not pay or voluntarily permit the determination of any Claim while the Indemnifying Party is negotiating the settlement thereof or litigating the Claim, except with the prior written consent of the Indemnifying Party.

5.7 Assumption by Indemnified Party.  Notwithstanding anything contained herein to the contrary, the Indemnified Party may, by releasing the Indemnifying Party from liability to him or it with respect to such Claim, take over and assume the settlement and defense of any Claim.

6. General Provisions.

6.1 Expenses.  Each party shall pay its own legal, accounting and other expenses.

6.2 Headings.  Headings are for convenience and are not admissible as to construction.

6.3 Notices.  All notices or other communications required or permitted to be given pursuant to this Agreement shall be in writing and shall be considered as properly given or made if hand delivered or sent by overnight courier or delivery service or facsimile transmission to the applicable address appearing in the preamble to this Agreement, or to such other address as either party may have designated by like notice forwarded to the other party hereto.  All notices, except notices of change of address, shall be deemed given one business day if they have been mailed by overnight courier or delivery service, or immediately if they have been hand delivered or faxed, and notices of change of address shall be deemed given when received.  Notice shall be sent to the following addresses, unless otherwise changed as set forth herein:

 

  

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	 	If to Sellers:	NorthStar Consumer Products, LLC 

10 Saugatuck Ave.

Westport CT 06880

Attn: John Linderman

Facsimile: 203 226 9029

	 	 	 
	 	If to Shareholders:	John Linderman and James Barickman 

10 Saugatuck Ave

Westport CT 06880

Facsimile: 203 226 9029

	 	 	 
	 	If to TWS: 	Tristar Wellness Solutions, Inc. 

10 Saugatuck Ave.

Westport, Connecticut 06880Attn: Harry Pond, CEO

Facsimile: 203 226 9029

	 	 	 
	 	If to Purchaser:	TriStar Consumer Products, Inc. 

10 Saugatuck Ave.

Westport, Connecticut 06880

Attn: Harry Pond, CEO

Facsimile: 203 226 9029

	 	 	 
	 	with a copy to:	Law Offices of Craig V. Butler 

9900 Research Drive

Irvine, CA  92618

Attn:  Craig V. Butler, Esq.

Facsimile (949) 209-2545

 

6.4 Severability.  Every provision of this Agreement is intended to be severable.  If any term or provision hereof is illegal or invalid for any reason whatsoever, such illegality or invalidity shall not affect the validity of the remainder of this Agreement.

6.5 Application of Law; Venue.  This Agreement, and the application or interpretation thereof, shall be governed exclusively by its terms and by the laws of the State of Connecticut.  Venue for any cause of action brought relating to this Agreement or the Contemplated Transactions shall be Fairfield County, Connecticut.

 

  

11

  

6.6 Counterparts.  This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

6.7 No Third-Party Beneficiaries.  Nothing expressed or referred to in this Agreement will be construed to give any person or entity other than the parties to this Agreement any legal or equitable right, remedy or claim under or with respect to this Agreement or any provision of this Agreement.

6.8 Legal Fees and Costs.  If a legal action is initiated by any party to this Agreement against another, arising out of or relating to the alleged performance or non-performance of any right or obligation established hereunder, or any dispute concerning the same, the prevailing party shall be reimbursed by the non-prevailing party for all reasonable expenses incurred in resolving such disputes, including reasonable attorneys’ fees.

6.9 Binding Agreements; Non Assignability.  Each of the provisions and agreements herein contained shall be binding upon and inure to the benefit of the personal representatives, heirs, devisees and successors of the respective parties hereto; but none of the rights or obligations attaching to either party hereunder shall be assignable, unless specifically noted.

6.10 Entire Agreement; Waiver.  This Agreement of the parties hereto with respect to the subject matter hereof, along with the exhibits and schedules hereto, constitutes the entire agreement between the parties, and no amendment, waiver, modification or alteration of the terms hereof shall be binding unless the same be in writing, dated subsequent to the date hereof and duly approved and executed by each party.  No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any other or further exercise thereof of the exercise of any other right, power or privilege.  The rights and remedies herein shall be cumulative and not exclusive of any right or remedies provided by law.

[remainder of page intentionally left blank; signature page to follow]

 

  

12

  

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

 

	 	
“TWS”

 

Tristar Wellness Solutions, Inc.

a Nevada corporation

	 
	 	 	 	 
	
 

	
By: 

	/s/ Harry Pond 	 
	 	 	Harry Pond, President	 
	 	 	 	 
	 	
“PURCHASER”

TriStar Consumer Products, Inc.,

a Nevada corporation

	 
	 	 	 	 
	 	
By: 

	/s/ Harry Pond 	 
	 	 	Harry Pond, President	 
	 	 	 	 
	 	
“SELLER”

NorthStar Consumer Products, LLC

a Connecticut limited liability company

	 
	 	 	 	 
	 	
By: 

	/s/ John Linderman	 
	 	 	John Linderman, President	 
	 	 	 	 
	 	
“SHAREHOLDERS”

	 
	 	 	 	 
	 	 	/s/ John Linderman 	 
	 	 	John Linderman, an individual	 
	 	 	 	 
	 	 	/s/ James Barickman   	 
	 	 	James Barickman, an individual	 
	 	 	 	 

 

  

13

  

 

LIST OF SCHEDULES AND EXHIBITS

 

	
Schedule 1.2

	
Excluded Assets

	  	  
	
Schedule 2.6

	
Material Contracts

	  	  
	
Schedule 2.10.1

	
Personnel

	  	  
	
Exhibit A

	
Assets

	  	  
	
Exhibit B

	
Assumed Liabilities

 

  

14

  

Schedule 1.2

Excluded Assets

All assets of NCP not relating to the Business shall be considered Excluded Assets and not part of the Assets being transferred to the Purchaser, including, but not limited to the following:

	
·  

	
NorthStar Consulting, LLC – Consulting business managed by John Linderman and James Barickman

	
·  

	
OilFax Oil diagnostic product designs and patent(s)

	
·  

	
Syzygy LLC, Owners of direct Access Testing business model

	
·  

	
All existing office equipment and computer equipment

 

 

  

15

  

 

Schedule 2.6

Material Contracts

	
·  

	
Contract with Michele Brown related to Beaute de Maman executed December 31, 2011. All obligations of the purchase agreement between NCP and Dr. Michele Brown will be transferred to the Purchaser. Material obligations include:

	
o  

	
Royalty payment to Michele Brown – Seven percent (7%) of Net Invoiced Value (as defined below) for all products sold under the Beaute de Maman brand name and derived from formulas transferred under the agreement with NCP for a 20 year period ending December 31, 2031.

	
o  

	
Royalty payments will be made quarterly within 45 days following the last day of each calendar quarter.

	
o  

	
“Net Invoiced Value” means the gross proceeds actually received by NCP from the sale of products during the applicable time frame, less the value for product returns, refunds referral fees, credit card fees, sales and similar taxes any separately stated shipping and handling expenses, any brokers’ commissions, fees paid to online sales platforms such as, but not limited to, www.amazon.com, and similar selling expenses and commissions as well as any adjustments to list price associated with invoice terms or “off-invoice” allowance deductions.

 

	
o  

	
NCP agrees to purchase all available Saleable Inventory from Michele Brown  at such time as its sells same to its customers and, further agrees to acquire any unsold Saleable Inventory on or before the third year anniversary of the date of this Agreement. Purchaser shall not make payment for any item of Saleable Inventory until such item is sold in commerce (or is otherwise acquired by NCP).  Promptly upon the sale of any item(s) of Saleable Inventory, but in any event no less frequently than monthly, NCP shall remit payment for such item(s) to Michele Brown at the price(s) specified in the executed Purchase Agreement. For the purposes of the foregoing, “Saleable Inventory” means:  (A) the finished goods of the Products held for sale by or for the benefit of NCP that are in good and merchantable condition; (B) Michele Brown’s’ stock of labels and packaging that is current and useable in the production of the Products for commercial sale; (C) any production samples of the Products being held for stability and production control; and (D) any components of Saleable Inventory specifically identified in the executed Purchase Agreement.  NCP agrees to purchase all existing inventory from Michele Brown to fulfill consumer and customer orders as long as the inventory remains in a condition suitable for sale.

 

	
o  

	
NCP must continuously maintain for the entire “Royalty Period” (as hereinafter defined), product liability insurance  in the amount of no less than two million dollars ($2,000,000),  which policy must, at a minimum, cover claims regarding all covered products regardless of who manufactured same. NCP further agrees to name Michele Brown as an additional insured under all such policies.

	
o  

	
NCP agrees that, notwithstanding the amount of the actual Adjusted Gross Receipts for Covered Products, it shall pay Michele. Brown a Minimum Royalty Payment of five hundred dollars ($500.00) per month for all Covered Products sold during the monthly period. The monthly Minimum Royalty Payment will be calculated against actual Royalty Payments on an annual basis. The Minimum Royalty Payment will only be provided to Dr. Brown in the case that current fiscal year to date payment is below the defined Minimum Royalty Payment terms. This Minimum Royalty Payment will become effective on April 1, 2012 and continue in effect for the full twenty year duration of the Royalty Period  The Royalty Payments shall be paid without set-off or deduction of any kind. Upon successful sale of the product line as defined below, NCP will not be entitled to Royalty Payments beyond this transaction date.

 

  

16

  

 

	
o  

	
Sale of Product Line.  In the event of a sale of the NCP’s business as it relates to the Covered Products, including, without limitation, any sale included a part of a sale of all or substantially all the assets of NCP or a merger or recapitalization by NCP or sale of equity interests by any member of NCP that results in the transfer of all or any portion of the Product Line (as hereinafter defined) from NCP to a person or entity unaffiliated with NCP, NCP shall make payment to Michele Brown (the “Product Line Payment”) in an amount equal to twenty percent (20%) of that portion of the proceeds reasonably allocable to the Product Line.  For the purposes of the foregoing, the “Product Line” means the Covered Products and the Intellectual Property conferring the right in the owner to market and distribute any or all of the Covered Products.  For the avoidance of doubt, Product Line includes any products that are pregnancy related.  If the sale of a Product Line is consummated that involves any payments that are not made at the closing of such transaction, such as NCP notes or earn-out payments, the applicable portion of the payment obligation set forth herein relating to such deferred or contingent payments shall only become due and payable upon receipt of any such payments by NCP or its affiliates.  Further, in the event that NCP is required to return any purchase consideration received in connection with one of the foregoing transactions, including the sale of a Product Line, as a result of indemnification obligations or otherwise, Sellers shall promptly pay to Purchaser NCP’ portion of any such returned proceeds.  It shall be a condition to any sale under this Section 2I that the prospective purchaser (or surviving entity in any merger) shall: (i) then have (and shall confirm to Michele Brown it writing its agreement to maintain for a period of time not less than the then remaining Royalty Period) product liability insurance in amounts greater than or equal to (and with  coverage greater than or equal to) the insurance required to be maintained by Purchaser under this Agreement; and (ii) name Michele Brown as an additional named insured under such policy or policies

	
o  

	
Michele Brown shall provide certain consulting services to NCP from time to time, upon NCP’s request, including, but not limited to, developing maternity-related content for http://www.beautedemaman.com,or any other website that NCP  might use to promote the sale of Products, the identification, formulation, packaging and positioning of any new products that can be added to the brand, and providing ad hoc advisory services (collectively, the “Services”).  NCP retains ownership of all content created by Michele Brown for any use in other marketing or advertising activities at NCP’s sole discretion. In consideration of Michele Brown’s provision of the Services, NCP shall pay to Michele Brown a consulting fee (the “Consulting Fee”) in an amount equal to the greater of: (i) One Hundred Dollars ($100) per hour for each hour that Michele Brown performs Services during the prior month; or (ii) One Thousand Dollars ($1,000.00).  Within ten (10) days following the end of each calendar month, Michele Brown shall submit to NCP a schedule identifying the nature and duration of Services performed during such month.  NCP agree that the maximum level of monthly consulting support for Michele Brown will not exceed $1,000 per month for the first twelve (12) months following the execution of this agreement. Michele Brown will provide the independent consulting activities in any manner using any electronic, internet or personal office location at her discretion. NCP shall pay the Consulting Fee within thirty (30) days following receipt of Michele Brown’s monthly invoice.  At any point during this agreement, NCP and Michele Brown can mutually agree to increase the Consulting Fee. The minimum Consulting Fee may be increased on the anniversary date of the executed agreement for each subsequent year.

 

  

17

  

 

Schedule 2.10

Personnel

	
o  

	
John Linderman – Annual compensation $300,000.00

	
o  

	
James Barickman – Annual compensation $300,000.00

 

 

 

 

 

  

18

  

 

Exhibit A

Assets

The Assets are all assets, trade products and services related to the Beauté de Maman line of health and beauty products and the formulation development for the itch suppression formula.

Beauté de Maman is a unique line of health & beauty products developed by a board-certified OBGYN to treat problems specifically related to the physiological and hormonal changes experienced by women during pregnancy. The Assets will include, but are not limited to:

	
1)  

	
“Beauté de Maman” brand, logo, domain name and website:  (www. beautedemaman.com);

	
2)  

	
All inventory existing at Closing in “as is” condition;

	
3)  

	
All third party contracts and relationships related to Beauté de Maman products, including all supplier agreements;

	
4)  

	
All customer lists, mailing lists, and customer data;

	
5)  

	
All marketing, training and promotional content and materials prepared by Sellers and/or its employees and independent contractors relating to the Assets; and

	
6)  

	
Any office equipment designated by the Purchaser.

The itch suppression assets include formula proprietary formula knowledge and development activity.

 

  

19

  

Exhibit B

Assumed Liabilities

	
o  

	
All liabilities for managing the Beaute de Maman business as defined within the executed Purchase Agreement between NCP and Michele Brown. Specifically included liabilities include:

 

	
o  

	
$7,386.00 payment to Michele Brown for formula transfer, due April 1, 2013;

 

	
o  

	
All formula and package development associated with retail distribution plans;

 

	
o  

	
All manufacturing and inventory costs associated with Beaute de Maman products;

 

	
o  

	
All expenses associated with the normal course of business and associated costs for selling products via the internet or retail channels.

 

	
o  

	
All liabilities associated with the continued formula development of the itch suppression product. Known liabilities include, but are not limited to, the following:

 

	
o  

	
Cadaver skin testing;

 

	
o  

	
Clinical efficacy and claims testing;

 

	
o  

	
Formula optimization and initial product manufacturing;

 

	
o  

	
Consumer research concept and product testing;

 

	
o  

	
FDA filing and registration;

 

	
o  

	
Potential patent filing;

 

	
o  

	
Legal costs associated with finalizing formulation and IP agreements with third party providers.

 

  

20tristar_ex102.htm

EXHIBIT 10.2

 

ASSET PURCHASE AGREEMENT

This Asset Purchase Agreement (the “Agreement”) is entered into as of February 12, 2013 (the “Effective Date”) by and between HLBC Distribution Company, Inc., a Nevada corporation (“Seller”), and Tristar Wellness Solutions, Inc., a Nevada corporation (“Purchaser”).  The Seller and the Purchaser shall each be referred to individually as a “Party” and collectively as the “Parties.”

RECITALS

WHEREAS, on or about December 10, 2010, RWIP, LLC, an Oregon limited liability company, sold all rights, title and interest to the assets described on Exhibit A (the “Soft and Smooth Assets”) to I-Web Media, Inc., a Delaware corporation (nka InterCore Energy, Inc.) (“ICOR”);

WHEREAS, on or about July 11, 2012, ICOR entered into a Marketing and Development Services Agreement (the “Marketing Agreement”) with the Purchaser, whereby ICOR granted Purchaser (i) the sole, exclusive rights to develop the Assets and market and sell the resulting products from the Soft and Smooth Assets in the Purchaser’s sole discretion for the next twelve (12) months, and (ii) starting with the sixth (6th) month following the execution of the Marketing Agreement and continuing until the end of the eleventh (11th) month following the execution of the Marketing Agreement, the Purchaser shall have the exclusive option, in its sole discretion, to purchase the Soft & Smooth Assets from ICOR provided, however, that the right of the Purchaser to purchase the Soft & Smooth Assets during the period starting with the sixth (6th) month until the end of the eight (8th) month shall be subject to ICOR’s agreement to sell.  In the event the Purchaser exercises this option, the Purchaser shall issue to ICOR warrants enabling ICOR to purchase One Hundred Fifty Thousand (150,000) shares of TWS common stock at $1.00 per share, with a four (4) year expiration period;

WHEREAS, on or about January 15, 2013, ICOR entered into an Assignment and Assumption Agreement with the Seller, whereby ICOR assigned and sold all rights, title and interest to the Soft and Smooth Assets to the Seller;

WHEREAS, the Seller and the Purchaser are seeking to effect the sale of the Soft and Smooth Assets by the Seller and the purchase by the Purchaser for the purchase price listed in the Marketing Agreement;

WHEREAS, the Purchaser believes that the acquisition of the Soft and Smooth Assets will further its business interests as a company interested in assets and businesses in the medical technology field; and

WHEREAS, the Seller desires to sell to Purchaser, and the Purchaser desires to purchase and acquire from the Seller, Seller’s interest in the Soft and Smooth Assets according to the terms set forth herein.

  

1

  

 

NOW, THEREFORE, in consideration of the mutual promises herein contained, the Parties hereby agree as follows:

	
I. 

	
Purchase and Sale of the Assets

1.1           Purchase and Sale of Assets.  The Seller hereby sells, transfers, assigns, and delivers to the Purchaser, free and clear of any liens or encumbrances of any kind, all of the Seller’s right, title, and interest in the Soft and Smooth Assets.

1.2           Assumption of Liabilities.  The Purchaser will assume any liabilities or obligations related to the Soft and Smooth Assets, and Seller represents that there are no liabilities or obligations related to the Soft and Smooth Assets.

1.3           Patent Assignment.  At Closing, the Seller shall deliver to Purchaser a Patent Assignment assigning to Purchaser any and all rights, interest, and title in and to its interest in the Soft and Smooth Assets in the form set forth in Exhibit B (the “Patent Assignment”).

1.4           Closing.  The closing shall be deemed to have taken place on the Closing Date, which shall be February 12, 2013.

1.5           Post-Closing Activities.  At any time after the Closing Date, upon any Party’s written request and without further consideration, the other Party shall take such other actions as the requesting Party may reasonably deem necessary or desirable in order to consummate the terms, and recognize the benefits, of obligations under and transactions contemplated by this Agreement.  The Parties recognize that the transfer of the Soft and Smooth Assets with the United States Patent and Trademark Office may take substantial time and agree to work together to complete the process.  Until the transfer of the Soft and Smooth Assets from the Seller to the Purchaser is formalized, the Purchaser shall have an irrevocable, exclusive license to the Soft and Smooth Assets.

	
II. 

	
Purchase Price

In consideration of the Seller’s sale, transfer, and assignment of the Assets, the Purchaser shall issue the Seller the following:

2.1           Warrant Agreement.  A warrant in the form attached hereto as Exhibit C, for the right to purchase One Hundred Fifty Thousand (150,000) shares of the Corporation’s common stock, restricted in accordance with Rule 144, with an exercise price of One Dollar ($1.00) per share (the “Warrant,” and together with the shares underlying the Warrant, the “Securities”).  This Agreement, the Patent Assignment, and the Warrant collectively are the “Transaction Documents.”

 

  

2

  

 

	
III. 

	
Representations and Warranties of the Seller

The Seller represents and warrants to the Purchaser, as of the date of this Agreement and again as of the Closing, as follows:

3.1           Organization.  The Seller is a corporation duly organized, validly existing, and in good standing under the laws of Nevada, and has all requisite corporate power and authority to carry on its business as now conducted by it and to own and operate its assets as now owned and operated by it.  The Seller has delivered to the Purchaser true and correct copies of the Seller’s Articles of Incorporation (the “Organizational Documents”) as currently in effect.

3.2           Authority; Enforceability.

(a) The Seller has the right, power, and authority to execute and deliver the Transaction Documents executed or to be executed by the Seller pursuant to this Agreement, and to perform its obligations thereunder.  The Transaction Documents, to which the Seller is a Party, constitute (or will, when executed and delivered as contemplated herein, constitute) the legally binding obligations of the Seller, enforceable in accordance with their respective terms.

(b) The execution, delivery, and performance of the Transaction Documents by the Seller, and the consummation of the transactions contemplated thereby, do not and will not: (i) require the consent, waiver, approval, license, or other authorization of any Person, except as provided for herein; (ii) violate any of provision of applicable law; (iii) contravene, conflict with, or result in a violation of any provision of the Seller’s Organizational Documents; (iv) conflict with, require a consent or waiver under, result in the termination of any provisions of, constitute a default under, accelerate any obligations arising under, trigger any payment under, result in the creation of any lien pursuant to, or otherwise adversely affect, any contract to which the Seller is a party or by which any of its assets are bound, in each such case whether with or without the giving of notice, the passage of time, or both.

(c) All requisite corporate action has been taken by the Seller to authorize and approve the execution and delivery of the Transaction Documents, the performance by the Seller of its obligations thereunder, and of all other acts necessary or appropriate for the consummation of the transactions contemplated by the Transaction Documents.

 

3.3           Legal Actions. There is no demand, action, suit, claim, proceeding, complaint, grievance, charge, inquiry, hearing, arbitration, or governmental investigation of any nature, public or private, (each, a “Proceeding”) pending or, to the knowledge of the Seller, threatened by or against the Seller (or any of its officers, directors, partners, or employees) related to the Assets, or involving any of the Assets, nor is there any basis for any such legal proceeding.

 

3.4           Personal Property, Inventory, and Title of Assets.  The Soft and Smooth Assets were acquired by the Seller in bona fide, arms-length transactions entered into in the ordinary course of business.  The Seller owns, and at the Closing, the Purchaser shall be vested with, all right, title, and interest in and to all of the Assets free and clear of any and all liens or encumbrances.

 

  

3

  

 

3.5           Tax Matters.

 

(a) The Seller has duly and timely filed all tax returns required to be filed by them under applicable law.  All such tax returns were correct and complete in all material respects.  All tax returns that have been made available to the Purchaser for inspection prior to the date hereof were true and complete copies of the tax returns actually filed by the Seller (or affiliates thereof), and have not been subsequently amended.  All taxes due and payable by the Seller (whether or not shown on any tax return) relating to the Assets or which could result in a lien on the Assets have been paid.  No claim has ever been made by an authority in a jurisdiction where the Seller does not file tax returns that the Seller is or may be subject to taxation by that jurisdiction in connection with or as a result of the ownership of the Assets.

 

(b) All taxes that the Seller is or was required by applicable law to withhold or collect which could result in a lien on the Assets have been duly withheld or collected and, to the extent required, have been paid to the proper governmental authority or other person or, if not paid, have been appropriately reserved.

 

(c) The Seller has no reason to believe that any governmental authority will or intends to assess any additional taxes which could result in a lien on the Assets for any period for which tax returns have been filed.  No dispute or claim concerning any tax liability of the Seller which could result in a lien on the Assets has been claimed or raised by any governmental authority in writing at any time in the past six (6) years.  There exists no proposed tax assessment against the Seller which could result in a lien on the Soft and Smooth Assets.

 

(d) The Seller has not waived any statute of limitations in respect of Taxes which could result in a lien on the Assets, or agreed to any extension of time with respect to a Tax assessment or deficiency which could result in a lien on any Assets.

 

(e) The Seller has not entered into any agreements with federal, state, or local taxing authorities, including any tax abatement or tax credit agreements, in connection with the Assets.

 

3.6           Material Contracts.

 

(a) The Seller has previously delivered to the Purchaser true and correct copies of all such material contracts (or accurate written summaries of any oral material contract) related to the Soft and Smooth Assets, each as currently in effect, including the Marketing Agreement.

 

(b) The Seller has not breached, violated, or defaulted under (or taken or failed to take any action that, with the giving of notice, the passage of time, or both would constitute a breach, violation, or default under), or received notice alleging that the Seller has breached, violated, or defaulted under (or taken or failed to take any action that, with the giving of notice, the passage of time, or both would constitute a breach, violation, or default under) any contract included in the Soft and Smooth Assets.  No other party obligated to the Seller pursuant to any such contract has breached, violated, or defaulted under (or taken or failed to take any action that, with the giving of notice, the passage of time, or both would constitute a breach, violation, or default under) any such contract.

 

  

4

  

 

(c) All of the contracts included in the Soft and Smooth Assets: (i) were entered into in the ordinary course of business on commercially reasonable terms, with bona fide third parties in arms-length transactions; (ii) are valid and enforceable in accordance with their terms; (iii) are in full force and effect; and (iv) will continue to be valid and enforceable and in full force and effect on identical terms following the Closing.  All such contracts can be fulfilled or performed in accordance with their respective terms in the ordinary course of business without undue or unusual expenditures of money or effort.

 

3.7           Certain Changes.  Since the Seller has owned the rights to the Soft and Smooth Assets, solely in the ordinary course of business consistent with past practices, and the Seller has used its reasonable best efforts to preserve the Soft and Smooth Assets.  Without limiting the foregoing, there has not been any:

 

(a) event or circumstance that has had or could reasonably be expected to have, individually or in the aggregate, a material adverse effect on, or a material adverse change in, the operations, affairs, prospects, condition (financial or otherwise), results of operations, or assets associated with the Assets, taken as a whole (“Material Adverse Change”);

 

(b) damage, destruction, or loss (whether or not covered by insurance) that resulted in, or could reasonably be expected to result in, losses or diminution of value with respect to the Soft and Smooth Assets;

 

(c) revaluation or write-down of any of the Soft and Smooth Assets;

 

(d) amendment or termination of any material contract other than in the ordinary course of business;

 

(e) change in accounting principles, methods, or practices of the Seller relating to the Assets, or in the manner the Seller keeps its books and records relating to the Soft and Smooth Assets;

 

(f) any settlement or compromise in any claim, suit, or cause of action relating to the Soft and Smooth Assets; or

 

(g) agreement by Seller to do, either directly or indirectly, any of the things described in the preceding clauses (a) through (f).

 

3.8           Brokers.  Neither the Seller nor any other person acting on its behalf has incurred any obligation or liability to any person for any brokerage fees, agent’s commissions, or finder’s fees in connection with the execution or delivery of the Transaction Documents or the consummation of the transactions contemplated hereby.

 

  

5

  

 

3.9           Certain Payments.  Neither the Seller nor any director, officer, or employee thereof, nor any other person associated with or acting for or on behalf of any of them, has, in connection with the Assets, directly or indirectly:  (a) made any contribution, gift, bribe, rebate, payoff, influence payment, kickback, or other payment to any Person, private or public, regardless of form, whether in money, property, or services (i) to obtain favorable treatment in securing business, (ii) to pay for favorable treatment for business secured, (iii) to obtain special concessions or for special concessions already obtained, or (iv) in violation of any applicable law; or (b) established or maintained any fund or asset that has not been recorded in the books and records of Seller maintained in the ordinary course in connection with the Soft and Smooth Assets.

3.10         Purchase for Own Account.  The Seller represents that it is acquiring the Securities solely for its own account and beneficial interest for investment and not for sale or with a view to distribution of the Securities or any part thereof, has no present intention of selling (in connection with a distribution or otherwise), granting any participation in, or otherwise distributing the same, and does not presently have reason to anticipate a change in such intention.

 

3.11         Ability to Bear Economic Risk.  The Seller acknowledges that investment in the Securities involves a high degree of risk, and represents that it is able, without materially impairing its financial condition, to hold the Securities for an indefinite period of time and to suffer a complete loss of its investment.

 

3.12         Further Limitations on Disposition.  The Seller further acknowledges that the Securities are restricted securities under Rule 144 of the Act (as defined below), and, therefore, when issued by the Purchaser to the Seller will contain a restrictive legend substantially similar to the following:

 

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”).  THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER THE ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.

 

Without in any way limiting the representations set forth above, the Seller further agrees not to make any disposition of all or any portion of the Securities unless and until:

 

(i)           There is then in effect a Registration Statement under the Act covering such proposed disposition and such disposition is made in accordance with such Registration Statement; or

 

(ii)           The Seller shall have notified the Purchaser of the proposed disposition and shall have furnished the Purchaser with a detailed statement of the circumstances surrounding the proposed disposition, and if reasonably requested by the Purchaser, the Seller shall have furnished the Purchaser with an opinion of counsel, reasonably satisfactory to the Purchaser, that such disposition will not require registration under the Act or any applicable state securities laws.

 

  

6

  

 

Notwithstanding the provisions of subparagraphs (i) and (ii) above, no such registration statement or opinion of counsel shall be necessary for a transfer by the Seller to a partner (or retired partner) of the Seller, or transfers by gift, will, or intestate succession to any spouse or lineal descendants or ancestors, if all transferees agree in writing to be subject to the terms hereof to the same extent as if they were the Seller hereunder.

 

	
IV. 

	
Representations and Warranties of the Purchaser

4.1           Organization.  The Purchaser is a corporation duly organized, validly existing, and in good standing under the laws of the State of Nevada.

 

4.2           Authority; Enforceability.  The Purchaser has full corporate power and authority to execute and deliver the Transaction Documents to which it is, or will be, a party, and to perform its obligations thereunder.  The Transaction Documents to which the Purchaser is a party constitute (or will, when executed and delivered at the Closing, constitute) the legally binding obligations of the Purchaser, enforceable in accordance with their respective terms.  The execution, delivery, and performance of the Transaction Documents by the Purchaser, and the consummation of the transactions contemplated thereby, do not and will not: (a) require the consent, waiver, approval, license or other authorization of any Person; (b) violate any provision of Applicable Law applicable to the Purchaser; (c) contravene, conflict with, or result in a violation of:  (i) any provision of the Purchaser’s Articles of Incorporation, Regulations, or any other governing or constitutive documents of the Purchaser; or (ii) any resolution adopted by the manager, member, or other governing bodies of the Purchaser; or (d) conflict with, result in the termination of any provisions of, constitute a default under, accelerate any obligations arising under, trigger any payment under, or otherwise adversely affect, any material contract to which the Purchaser is a party, which, as to each of (a) through (d), would materially and adversely affect the Purchaser’s ability to consummate the transactions contemplated herein or to perform its obligations under the Transaction Documents to which the Purchaser is a party.  All requisite corporate action has been taken by the Purchaser authorizing and approving the execution and delivery by the Purchaser of the Transaction Documents to which the Purchaser is or will be a party, the performance by the Purchaser of its duties and obligations thereunder, and the taking of all other acts necessary and appropriate for the consummation of the transactions contemplated thereby.

 

4.3           Brokers.  The Purchaser has not incurred any obligation or liability to any Person for any brokerage fees, agent’s commissions, or finder’s fees in connection with the execution or delivery of the Transaction Documents or the transactions contemplated hereby.

 

  

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V. 

	
Consents

The Seller will use its reasonable best efforts to obtain or cause to be obtained any consents required in connection with the transactions contemplated by any of the Transaction Documents that are requested by the Purchaser and that have not been previously obtained prior to or at the Closing.  Notwithstanding anything to the contrary set forth herein, this Agreement shall not constitute an assignment or attempt to assign or transfer any interest in any contract or permit otherwise included in the Soft and Smooth Assets, or any claim, right or benefit arising thereunder or resulting therefrom, if such assignment or transfer is without the consent of a third party and would constitute a breach or violation thereof or adversely affect the rights of the Purchaser or the Soft and Smooth Assets.  Until all such consents are obtained, the Seller shall cooperate in any arrangement reasonably satisfactory to the Purchaser designed to fulfill the Seller’s obligations thereunder and to afford the Purchaser the continued full benefits thereof.

 

	
VI. 

	
Covenants

6.1           Further Assurances.  From time to time (including after the Closing), the Parties will execute and deliver such other documents, certificates, agreements, and other writings and take such other actions as may reasonably be necessary or requested by another Party in order to consummate, evidence or implement expeditiously the transactions contemplated by this Agreement.

 

6.2           Fulfillment of Conditions.  The Parties hereto agree to take and to cause to be taken in good faith commercially reasonable efforts to fulfill, as soon as reasonably practicable, the conditions to Closing.

 

6.3           Certain Filings.  The Parties hereto shall cooperate with one another in determining whether any action by or in respect of, or filing with, any governmental authority is required, or any action, consent, approval, or waiver from any party to any contract is required, in connection with the consummation of the transactions contemplated by this Agreement.  Subject to the terms and conditions of this Agreement, in taking such actions or making any such filings, the Parties hereto shall furnish information reasonably required in connection therewith and timely seek to obtain any such actions, consents, approvals, or waivers.

 

6.4           Non-Compete Agreement.  The Seller, and its principals, employees and consultants, covenant and agree that for a period of five (5) years following the Closing Date, they shall not individually or through any other Person or Affiliate of the Seller, engage directly or indirectly in any Competitive Business, whether such engagement be as an employer, officer, director, owner, investor, employee, partner, consultant or other participant in any Competitive Business.  For purposes of this Agreement, “Person” shall mean a corporation, partnership, trust, limited liability company, association, or other business entity or an individual.  “Affiliate” shall mean another Person controlled by, controlling, or under common control with the Seller.  “Competitive Business” means any business that is similar to the Assets.  The Seller acknowledges and agrees that, given the nature of Sellers’ business, the restrictions set forth in this Section 6.4 are necessary and reasonable in terms of the activities restricted, as well as the geographic and temporal scope of such restrictions.  The Seller further acknowledges and agrees that if any of the provisions of this Section 6.4 shall ever be deemed to exceed the time, activity, geographic, or other limitations permitted by applicable law, then such provisions shall be and hereby are reformed to the maximum time, activity, geographic, or other limitations permitted by applicable law.

 

  

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VII. 

	
Indemnification

7.1           Agreement to Indemnify.

 

(a) The Seller shall indemnify, defend, and hold harmless the Purchaser and its respective officers, directors, employees, representatives, agents, successors, and assigns (collectively, the “Indemnitees”) from, against, and in respect of any and all damages incurred by any Indemnitee arising out of or as a result of:  (i) any inaccuracy or misrepresentation in or breach of any representation or warranty made by the Seller in this Agreement; (ii) any breach of any covenant or agreement made by the Seller in this Agreement; and/or (iii) any and all proceedings, judgments, decrees, awards, assessments, fees, and expenses incident to any of the foregoing or incurred in investigating or attempting to avoid the same or to oppose the imposition thereof, or in enforcing this indemnification.

 

(b) The Seller shall not be required to provide indemnification to any Indemnitee pursuant to Section 7.1(a) unless and until the aggregate amount of all damages incurred by all Indemnitees responsive to such Section exceeds Five Thousand Dollars ($5,000) (the “Deductible”), whereupon the Indemnitees shall be entitled to indemnification under such Section only with respect to damages in excess of such Deductible.  The maximum aggregate monetary liability of the Seller to indemnify the Indemnitees under Section 7.1(a) shall not exceed the Purchase Price (the “Cap”) in the aggregate.  Notwithstanding the foregoing, neither the Deductible nor the Cap shall apply to claims arising out of fraud, intentional misrepresentation, or gross negligence.

 

(c) If any third party notifies any Indemnitee with respect to any matter which may give rise to a claim for indemnification against the Seller under this Article VII, then the Indemnitee will notify the Seller thereof within thirty (30) days thereafter, such notice to state the nature and basis of any claim made by the third party; provided that, no delay on the part of the Indemnitee in notifying the Seller will relieve the Seller from any obligation hereunder unless, and then solely to the extent that, the Seller is demonstrably prejudiced thereby.  In the event the Seller notify the Indemnitee within thirty (30) days after the date the Indemnitee has given notice of the matter that the Seller will indemnify the Indemnitee in respect of such matter, then the Seller may, by notice to the Indemnitee within such 30-day period, assume the defense of such matter.  If the Seller assume the defense of such matter, (i) the Seller will defend the Indemnitee against the matter with counsel of Seller’s choice reasonably satisfactory to the Indemnitee, (ii) the Indemnitee may retain separate counsel at its sole cost and expense, and (iii) the Seller will not consent to the entry of a judgment or consent order with respect to the matter, or enter into any settlement, in each case which either (A) grants the plaintiff or claimant any form of relief other than monetary damages which will be satisfied by the Seller or (B) fails to include a provision whereby the plaintiff or claimant in the matter releases the Indemnitees from all liability with respect thereto, in either such case without the written consent of the Indemnitee (which consent shall not be unreasonably withheld or delayed).  If the Seller has not assumed the defense of such matter, (i) the Indemnitee may defend against the matter in any manner it reasonably may deem appropriate and with counsel of its choice, and (ii) the Seller may retain separate counsel at their sole cost and expense.  Notwithstanding anything to the contrary in the foregoing, if defendants in any action include any Indemnitee and Seller, and such Indemnitee shall have been advised by its counsel that there may be material legal defenses available to such Indemnitee inconsistent with those available to Seller, or if a conflict of interest exists between an Indemnitee and Seller with respect to such claim or the defense thereof, or if an Indemnitee reasonably determines that Seller’s control of such defense would reasonably be expected to have an adverse effect on the Assets or the outcome of the matter, then in any such case, the Indemnitee shall have the right to reassert such defense through its own counsel, and in such event (or in the event that the Seller does not timely assume or diligently pursue the defense of such matter as provided above) the reasonable fees and expenses of the Indemnitee’s counsel shall be borne by the Seller and shall be paid by them from time to time within twenty (20) days of receipt of appropriate invoices therefore.

 

  

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(d) In the event that an Indemnitee notifies the Seller of any claim for indemnification hereunder that does not involve a third party claim, the Seller shall, within thirty (30) days after the date of such notice, pay to the Indemnitee the amount of damages payable pursuant to this Section 7.1 and shall thereafter pay any other damages payable pursuant to this Section 7.1 and arising out of the same matter on demand, unless the Seller dispute in writing its liability for, or the amount of, any such damages within such 30-day period, in which case such payment shall be made as provided above in respect of any matters or amounts not so disputed and any damages in respect of the matters so disputed shall be paid within five (5) business days after any determination (by agreement of Purchaser and Seller, or pursuant to arbitration in accordance with Section 8.3) that the Seller are liable therefore pursuant to this Section 7.1.

 

(e) In connection with any payment of damages pursuant to this Section 7.1, the Seller shall pay to the Indemnitee(s) an amount calculated like interest on the amount of such damages at the applicable interest rate from the date of Closing until the Indemnitee(s) shall have been indemnified in respect thereof.

 

Section 7.2             Survival of Representations, Warranties, and Covenants.

 

(a) Except as otherwise provided in this Section 7.2, all representations and warranties contained herein, and the right to assert claims in respect of any breach thereof, shall survive the Closing and any investigation heretofore or hereafter conducted by or on behalf of the Party entitled to benefit thereof, and shall expire on the third (3rd) anniversary of the Closing Date.

 

  

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(b) Notwithstanding anything to the contrary herein, the survival period in respect of any representation or warranty in this Agreement, or any related claim, shall be extended automatically to include any time period necessary to resolve a claim which was asserted but not resolved before expiration of such survival period.  Liability for any such item shall continue until such claim shall have been finally settled, decided, or adjudicated.

 

(c) Notwithstanding anything herein to the contrary, all covenants, agreements and obligations contained herein shall survive the Closing and not expire unless otherwise specifically provided in this Agreement.

 

Section 7.3             No Other Representations; Express Negligence.

 

(a) THE REPRESENTATIONS AND WARRANTIES OF THE SELLER AND PURCHASER CONTAINED IN THIS AGREEMENT AND THE OTHER TRANSACTION DOCUMENTS CONSTITUTE THE SOLE AND EXCLUSIVE REPRESENTATIONS AND WARRANTIES OF SUCH PARTIES, RESPECTIVELY, IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED HEREBY.  EXCEPT FOR SUCH REPRESENTATIONS AND WARRANTIES (IN EACH CASE, AS MODIFIED BY THE SCHEDULES), NONE OF SELLER, PURCHASER OR ANY OTHER PERSON MAKES ANY OTHER EXPRESS OR IMPLIED REPRESENTATION OR WARRANTY WITH RESPECT TO SUCH PARTIES OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, AND EACH PARTY DISCLAIMS ANY OTHER REPRESENTATIONS OR WARRANTIES, WHETHER MADE BY SUCH PARTIES OR ANY OF THEIR OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, OR REPRESENTATIVES.  PURCHASER ACKNOWLEDGES AND AGREES THAT IT HAS NOT RELIED ON ANY REPRESENTATIONS AND WARRANTIES OTHER THAN THE EXPRESS REPRESENTATIONS AND WARRANTIES SET FORTH IN THIS AGREEMENT OR THE OTHER TRANSACTION DOCUMENTS IN MAKING ITS INVESTMENT DECISION WITH RESPECT TO THE ASSETS.

 

(b) THE INDEMNITIES SET FORTH IN THIS ARTICLE VII ARE INTENDED TO BE ENFORCEABLE AGAINST THE PARTIES IN ACCORDANCE WITH THE EXPRESS TERMS AND SCOPE THEREOF NOTWITHSTANDING ANY EXPRESS NEGLIGENCE RULE OR ANY SIMILAR DIRECTIVE THAT WOULD PROHIBIT OR OTHERWISE LIMIT INDEMNITIES BECAUSE OF THE SIMPLE OR GROSS NEGLIGENCE (WHETHER SOLE, CONCURRENT, ACTIVE, OR PASSIVE) OR OTHER FAULT OR STRICT LIABILITY OF ANY INDEMNITEE.  THE PARTIES HERETO ACKNOWLEDGE THAT THE INDEMNITIES SET FORTH HEREIN MAY RESULT IN THE INDEMNIFICATION OF A PARTY FOR ITS SIMPLE OR GROSS NEGLIGENCE (WHETHER SOLE, CONCURRENT, ACTIVE, OR PASSIVE) OR OTHER FAULT OR STRICT LIABILITY OF THE INDEMNIFIED PARTY.  NOTWITHSTANDING THE FOREGOING, NO INDEMNIFYING PARTY SHALL BE OBLIGATED TO INDEMNIFY ANY OTHER PARTY FOR ANY LOSSES OR EXPENSES PURSUANT TO THIS ARTICLE VII TO THE EXTENT THAT THE AMOUNT OF THE LOSSES OR EXPENSES INCURRED BY THE INDEMNIFIED PARTY WERE GREATER THAN THEY OTHERWISE WOULD HAVE BEEN AS A DIRECT RESULT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE INDEMNIFIED PARTY.

 

  

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VIII. 

	
Miscellaneous

8.1            Assignment.  Neither this Agreement nor any interest hereunder will be assignable in part or in whole by either Party without the prior written consent of the non-assigning Party, which consent will not be unreasonably withheld, conditioned, or delayed.

8.2           Governing Law and Venue.  This Agreement is executed pursuant to and shall be interpreted and governed for all purposes under the laws of the State of to Connecticut.  Any cause of action brought to enforce any provision of this Agreement shall be brought in the appropriate court in Fairfield County, Connecticut.  If any provision of this Agreement is declared void, such provision shall be deemed severed from this Agreement, which shall otherwise remain in full force and effect.  This Agreement shall supersede any previous agreements, written or oral, expressed or implied, between the parties relating to the subject matter hereof.

8.3           Dispute Resolution.  In the event of any controversy, dispute, or claim arising out of or related to this Agreement or the breach thereof, the Purchaser and the Seller agree to meet and confer in good faith to attempt to resolve the controversy, dispute, or claim without an adversary proceeding.  If the controversy, dispute, or claim is not resolved to the mutual satisfaction of the Purchaser and the Seller within ten (10) business days of notice of the controversy, dispute, or claim, the Purchaser and the Seller agree to waive their rights, if any, to a jury trial, and to submit the controversy, dispute, or claim to a retired judge or justice for binding arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association.  The Purchaser and the Seller agree that the only proper venue for the submission of claims shall be the Fairfield County, Connecticut.  Judgment on the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof.  Any dispute resolution proceedings contemplated by this provision shall be as confidential and private as permitted by law.

8.4           Notices.  Any notice, request, demand, or other communication given pursuant to the terms of this Agreement shall be deemed given upon delivery, and may only be delivered or sent via hand delivery, facsimile, or by overnight courier, correctly addressed to the addresses of the parties indicated below or at such other address as such Party shall in writing have advised the other Party.

  

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	 	If to the Purchaser:	Tristar Wellness Solutions, Inc.
	 	 	10 Saugatuck Ave.
	 	 	Westport, Connecticut 06880
	 	 	Attn: Harry Pond, CEO
	 	 	Facsimile: (203) 226-9029
	 	 	 
	 	With a copy to:	Craig V. Butler, Esq.
	 	 	Law Offices of Craig V. Butler
	 	 	9900 Research Drive
	 	 	Irvine, CA  92618
	 	 	Facsimile: (949) 209-2545
	 	 	 
	 	If to the Seller: 	HLBC Distribution Company, Inc.
	 	 	8270 S. 33rd Street, #307
	 	 	Lincoln, Nebraska 68516
	 	 	Attn. M. Scott Stevens
	 	 	Telephone:  _______________
	 	 	Facsimile:  ________________
	 	 	Email: ___________________

 

8.5           Amendment.  No amendment, modification, or supplement of any provision of this Agreement will be valid or effective unless made in writing and signed by a duly authorized officer of each Party.

8.6           Waiver.  No provision of this Agreement will be waived by any act, omission, or knowledge of a Party or its agents or employees except by an instrument in writing expressly waiving such provision and signed by a duly authorized officer of the waiving Party.

8.7           Severability.  Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under the applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision will be in effective only to the extent of such prohibition or invalidity, without invalidating the remainder of this Agreement.

8.8           Attorneys’ Fees.  In the event that any suit, arbitration, legal action, proceeding, or dispute between the Parties arises in connection with this Agreement, the prevailing Party shall be entitled to recover all expenses, costs, and fees, including reasonable attorney’s fees, actually incurred in association with such action.

 

8.9           Entire Agreement.  This Agreement, including all exhibits, is the complete, final, and exclusive understanding and agreement of the Parties and cancels and supersedes any and all prior negotiations, correspondence, and agreements, whether oral or written, between the Parties respecting the subject matter of this Agreement.

[remainder of page intentionally left blank; signature page to follow]

 

  

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

	
“Seller”

	 	
“Purchaser”

	 
	  	 	  	 
	
HLBC Distribution Company, Inc.

	 	
Tristar Wellness Solutions, Inc.,

	 
	
 a Nevada corporation

	 	
a Nevada corporation

	 
	  	 	  	 
	  	 	  	 
	
/s/ M. Scott Stevens

	 	
/s/ Harry Pond

	 
	
By: M. Scott Stevens

	 	
By: Harry Pond

	 
	
Its: President

	 	
Its: Chief Executive Officer

	 

 

 

  

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Exhibit A

Assets

The Assets are defined as the Patent Assignment and all rights, interests, and legal claims to that certain invention entitled DELIVERY DEVICE WITH INVERTIBLE DIAPHRAGM, including all information and intellectual property related to said invention.

The Assets, include, but are not limited to, the following patent applications that have been filed regarding the invention:

U.S. Provisional Application No. 61/071,766, filed May 16, 2008

PCT Patent Application No. PCT/US2009/044400, filed May 18, 2009

U.S. Continuation-in-Part Application No. 12/946,671, filed November 15, 2010;

Canada Application No. 2,724,504, filed May 18, 2009; and

EPC Patent Application No. 09747774.9, filed May 18, 2009.

 

  

15

  

Exhibit B

Patent Assignment

 

 

 

 

 

 

 

  

16

  

 

A S S I G N M E N T

WHEREAS, the undersigned is the owner of a certain invention, entitled DELIVERY DEVICE WITH INVERTIBLE DIAPHRAGM, for which the following applications have been filed:

U.S. Provisional Application No. 61/071,766, filed May 16, 2008

PCT Patent Application No. PCT/US2009/044400, filed May 18, 2009

U.S. Continuation-in-Part Application No. 12/946,671, filed November 15, 2010;

Canada Application No. 2,724,504, filed May 18, 2009

EPC Patent Application No. 09747774.9, filed May 18, 2009; and

WHEREAS, TRISTAR WELLNESS SOLUTIONS, INC., a corporation organized under the laws of the State of Nevada, having a place of business at 10 Saugatuck Ave., Westport, Connecticut 06880, desires to acquire an interest therein:

NOW, THEREFORE, for good and valuable consideration, the receipt of which is hereby acknowledged, the undersigned hereby sells, assigns and transfers to TRISTAR WELLNESS SOLUTIONS, INC., the full and exclusive right, title, and interest in and to said invention, patent application, and patent rights throughout the world, including foreign patent priority rights, the right to file and prosecute International Applications under the Patent Cooperation Treaty, and the right to file and prosecute applications under the European Patent Convention; said invention, application and letters patent in this or any foreign country, and all divisions, continuations, reissues and extensions thereof, to be held and enjoyed by TRISTAR WELLNESS SOLUTIONS, INC., for its own use and benefit, and for its successors and assigns to the full end of the term for which letters patent may be granted in this or any foreign country, as fully and entirely as the same would have been held by the undersigned had this assignment and sale not been made, and covenant that the undersigned has full right so to do, and agree that it will communicate to TRISTAR WELLNESS SOLUTIONS, INC., or its successors and assigns, any facts known to it respecting said invention, and testify in any legal proceeding, sign all lawful papers, execute all divisional, continuing and reissue applications, make all rightful oaths, and do everything possible to aid TRISTAR WELLNESS SOLUTIONS, INC., its successors and assigns to obtain and enforce proper patent protection for said invention in this or any foreign country.

  

17

  

 

The undersigned hereby grants the law firm of the Law Offices of Craig V. Butler, or its assigns, the power to insert on this Assignment any further information which may be necessary or desirable in order to comply with all applicable legal requirements, including the rules of the United States Patent and Trademark Office, for submitting and recording this document.

Executed in the City of _______________, State of ___________, this ___ day of February, 2013.

 

	 	HLBC Distribution Company, Inc.,	 
	 	a Nevada corporation	 
	 	 	 
	 	 	 
	 	 	 
	 	By: M. Scott Stevens	 
	 	Its: President	 

 

	STATE OF NEBRASKA	)	 
	 	)	ss.
	COUNTY OF [__________]	)	 

 

This ___ day of February, 2013, before me personally came the above-named M. Scott Stevens, who executed the foregoing instrument in my presence, and who acknowledged to me that this instrument was executed by M. Scott Steven’s own free will for the purpose set forth therein.

 

	 	 	 
	 	Notary Public for ________________	 
	 	My commission expires:	 

 

[SEAL]

 

  

18

  

 

Exhibit C

 

Warrant

 

 

 

 

 

 

 

19

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