Document:

kl06021_ex10-6.htm

    
      

    

     

    Exhibit
      10.6

     

     

     

    FIRST
      AMENDMENT

    TO

    AMENDED
      AND RESTATED STOCK SUBSCRIPTION

    AND
      SHARE TRANSFER AGREEMENT

     

    

    This
      First Amendment (this “First Amendment”) to Amended and Restated Stock
      Subscription and Share Transfer Agreement (the “Restated Original
      Subscription Agreement”), dated as of May 31, 2007, is by and between New
      World Brands, Inc., a Delaware corporation (the “Company”), and P&S
      Spirit, LLC, a Nevada limited liability company (the
“Subscriber”).  All capitalized terms not otherwise defined
      herein shall have the meanings ascribed to them in the Restated Original
      Subscription Agreement.

     

    RECITALS:

     

    WHEREAS,
      on December 29, 2006, the Company and the Subscriber entered into a Stock
      Subscription and Share Transfer Agreement, which the parties subsequently
      amended and restated in its entirety effective December 29, 2006 in the form
      of
      the Restated Original Subscription Agreement, providing for the purchase by
      the
      Subscriber of certain capital stock of the Company as more fully set forth
      therein; and

     

    WHEREAS,
      the Restated Original Subscription Agreement provides that upon the satisfaction
      of the Tranche B-1 Closing Condition and the Tranche B-2 Closing Condition,
      the
      Company will cause to be issued to the Subscriber the Tranche B-1 Shares and
      the
      Tranche B-2 Shares in consideration of the Tranche B-1 Purchase Price and the
      Tranche B-2 Purchase Price, as the case may be; and

     

    WHEREAS,
      Company management has determined that (i) based on current and projected sales,
      there is no reasonable expectation that the Company will meet the Tranche B-1
      Closing Condition or the Tranche B-2 Closing Condition, and (ii) it is very
      likely that due to reduced cash flow resulting from lower sales and continued
      investment in sales growth and product development, the Company’s cash position
      will reach critically low levels before the third quarter unless additional
      capital is made available to the Company; and

     

    WHEREAS,
      even though there is no reasonable expectation that the Tranche B-1 Closing
      Condition and the Tranche B-2 Closing Condition will be satisfied, and therefore
      the Subscriber will have no obligation to purchase the Aggregate Tranche B
      Shares, the Subscriber is willing to purchase the Aggregate Tranche B Shares
      in
      consideration for the agreement of the Company that (a) the total purchase
      price
      for the Aggregate Tranche B Shares shall be equal to the Tranche B-1 Purchase
      Price, and (b) any obligation of the Subscriber to pay the Tranche B-2 Purchase
      Price is hereby extinguished; and

     

    WHEREAS,
      the Company has requested the Subscriber to provide the Company with a line
      of
      credit of up to One Million Fifty Thousand Dollars ($1,050,000) for operating
      capital purposes (the “Credit Line Facility”), and the Subscriber is
      prepared to extend the Credit Line Facility to the Company under and in
      accordance with the terms and conditions set forth in that certain Credit Line
      and Security Agreement (the “Credit Agreement”) and that certain Credit
      Line Note (the “Note”), copies of which have been delivered to the
      Company and approved by unanimous consent of the Directors of the
      Company.

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

     

    NOW,
      THEREFORE, in consideration of the premises and the mutual agreements herein
      set
      forth, the parties hereto desire to amend the Restated Original Subscription
      Agreement to reflect the aforementioned and certain other changes thereto as
      set
      forth herein:

     

    1.           As
      of the Closing Date (as defined below), the Company irrevocably agrees to issue
      and sell to the Subscriber, and the Subscriber irrevocably agrees to purchase,
      a
      total of 22,222,222 shares of Common Stock (the “Shares”), for a total
      purchase price of One Million Dollars ($1,000,000) (the “Purchase
      Price”), and the Company shall deliver, or cause to be delivered, to the
      Subscriber, in accordance with the terms of the Escrow Agreement, stock
      certificates representing the Shares.

     

    2.           The
      obligation of the Subscriber to pay the Tranche B-2 Purchase Price is hereby
      extinguished, and the obligations of the Subscriber to consummate the Tranche
      B-1 and Tranche B-2 Closings, as described in the Restated Original Subscription
      Agreement, are hereby extinguished and such closings shall not
      occur.

     

    3.           The
      payment of the Purchase Price and the delivery of the Shares, shall occur and
      be
      effective simultaneously with the execution of this First Amendment, remotely
      at
      the offices of the Company, 340 W. 5th Avenue,
      Eugene,
      Oregon (the “Closing Date” and the closing the
“Closing”).  At the Closing:

     

    (a)           the
      Subscriber shall deliver, or cause to be delivered, to the Company:

     

    (i)   
      the Purchase Price, in immediately available funds by wire transfer to an
      account designated by the Company in writing to the Subscriber;

     

    (ii)  
      an executed copy of the Credit Agreement and all related documents, and shall
      have made the Credit Line Facility available pursuant to the terms
      thereof;

     

    (iii)  an
      executed copy of the First Amendment to Amended and Restated Voting Agreement
      in
      the form attached hereto as Annex 2;

     

    (iv)  an
      executed copy of the First Amendment to Amended and Restated Lock-Up Agreement
      in the form attached hereto as Annex 3; and

     

    (v)  
      a certificate executed by a duly authorized officer of the Subscriber certifying
      that the representations and warranties made by the Subscriber in Section
      4 of the Restated Original Subscription Agreement are true and correct in
      all material respects as of the Closing Date (except to the extent a
      representation or warranty is expressly limited by its terms to another date);
      and

     

    (b)           the
      Company shall deliver, or cause to be delivered, to the Subscriber:

     

    (i)  
       in accordance with the terms of the Escrow Agreement, stock certificates
      representing the Shares;

     

    (ii)  
      an executed copy of the Credit Agreement, the Note and all related
      documents;

     

     

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

     

    (iii)  an
      executed copy of the First Amendment to Amended and Restated Voting Agreement
      in
      the form attached hereto as Annex 2;

     

    (iv)  an
      executed copy of the First Amendment to Amended and Restated Lock-Up Agreement
      in the form attached hereto as Annex 3; and

     

    (v) 
      a certificate executed by a duly authorized officer of the Company certifying
      that (A) the  representations and warranties made by the Company in
Section 5 of the Restated Original Subscription Agreement are true and
      correct in all material respects as of the Closing Date (except to the extent
      a
      representation or warranty is expressly limited by its terms to another date),
      and (B) there shall have been no material adverse change in the business,
      condition (financial or otherwise), assets, liabilities (contingent or
      otherwise), operations or results of operations of the Company since the date
      of
      the Restated Original Subscription Agreement.

     

    4.           By
      execution of this First Amendment, the Company, M. David Kamrat and Noah Kamrat,
      all acknowledge that the Subscriber is contemplating transferring a portion
      of
      the membership interests of the Subscriber to Mark S. Kahan and agree that
      the
      transfer of such interests, if it occurs, shall be permitted notwithstanding
      anything to the contrary in the Restated Original Subscription Agreement as
      amended by this First Amendment, and the Company, M. David Kamrat and Noah
      Kamrat all waive any right that any of them may have to object to such
      transfer.

     

    5.           Except
      as specifically amended hereby, the Restated Original Subscription Agreement
      is
      hereby ratified and confirmed in all respects and shall remain in full force
      and
      effect.

     

    6.           To
      the extent of any inconsistency between the terms of the Restated Original
      Subscription Agreement and this First Amendment, the terms of this First
      Amendment will control.  Each reference in the Restated Original
      Subscription Agreement to “this Agreement,” “herein,” “hereunder” or words of
      similar import shall be deemed to be a reference to the Restated Original
      Subscription Agreement as amended by this First Amendment, and the Restated
      Original Subscription Agreement as so amended shall be read as a single,
      integrated document.

    

    7.           This
      First Amendment may be executed in two or more counterparts, and by the
      different parties hereto in separate counterparts, each of which when executed
      shall be deemed to be an original but all of which taken together shall
      constitute one and the same agreement.  Facsimile transmission of any
      signed original counterpart and/or retransmission of any signed facsimile
      transmission shall be deemed the same as the delivery of an
      original.  The introductory Recitals are incorporated into and made a
      substantive part of this First Amendment.

    

    

    [Signature
      page follows]

    

     

     

    

    
      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

    

    

     

     

    IN
      WITNESS WHEREOF, the parties hereto have executed this First Amendment as of
      the
      day and year first above written.

    

     

                    NEW
      WORLD BRANDS,
      INC.

    

    

                    By: /s/
      M. David Kamrat

                    Name:
M.
      David
      Kamrat

                    Title:  
      CEO

    

    

                    P&S
      SPIRIT,
      LLC

    

                    By: /s/
      Selvin Passen, M.D.

                    Name: Selvin
      Passen, M.D.

                    Title:   Manager

    

                    Acknowledged
      and
      agreed by M. David Kamrat and Noah Kamrat:

    

                                                

                    /s/
      M. David
      Kamrat

               
      M. David Kamrat

     

     

                                                   
      /s/ Noah Kamrat
                Noah
      Kamrat

    

     

     

    
 

    

    4kl06021_ex10-7.htm

    
      

    

     

    Exhibit
      10.7

    
 

    FIRST
      AMENDMENT

     

    TO

     

    AMENDED
      AND RESTATED VOTING AGREEMENT

     

    

    This
      First Amendment (this “First Amendment”) to Amended and Restated Voting
      Agreement (the “Restated Original Voting Agreement”), dated as of May 31,
      2007, is by and among New World Brands, Inc., a Delaware corporation (the
“Company”), Qualmax, Inc., a Delaware corporation (“Qualmax”),
      P&S Spirit, LLC, a Nevada limited liability company (“P&S”),
      Selvin Passen, M.D. (“Dr. Passen”), Oregon Spirit, LLC, a Nevada limited
      liability company (“Oregon Spirit”), and, solely for purposes of
Section 21 of the Restated Original Voting Agreement, M. David Kamrat,
      an
      individual (“D. Kamrat”), Jane Kamrat, an individual (“J.
      Kamrat”), Noah Kamrat, an individual (“N. Kamrat”), Tracy Habecker,
      an individual (“T. Habecker” and together with D. Kamrat, J. Kamrat and
      N. Kamrat the “Kamrat Family”, and the Kamrat Family and Qualmax together
      the “Qualmax Holders”).  Each of Qualmax, P&S, Dr. Passen
      and Oregon Spirit are herein referred to as a “Voting Stockholder,” and
      together as the “Voting Stockholders.”  All capitalized terms
      not otherwise defined herein shall have the meanings ascribed to them in the
      Restated Original Voting Agreement.

     

    RECITALS:

     

    WHEREAS,
      on December 29, 2006, the parties entered into an Amended and Restated Voting
      Agreement;

     

    WHEREAS,
      the parties recognize with extreme sadness the passing of Sylvia Passen on
      March
      14, 2007, and the shares of stock of the Company previously owned by Selvin
      and
      Sylvia Passen, TBTE, are now owned by Dr. Passen; and

     

    WHEREAS,
      in relation to that First Amendment to Amended and Restated Stock Subscription
      and Share Transfer Agreement of even date herewith among the Company and P&S
      Spirit, the parties desire to amend the Restated Original Voting Agreement
      as
      provided herein.

     

    NOW,
      THEREFORE, in consideration of the premises and the mutual agreements herein
      set
      forth, the parties hereto desire to amend the Restated Original Voting Agreement
      to reflect the aforementioned and certain other changes thereto as set forth
      herein:

     

    1.           Section
      2 of the Restated Original Voting Agreement shall be amended and replaced in
      its
      entirety, effective as of the effective date of this First Amendment, to read
      as
      follows:

     

    “2.           Nominations
      of Directors.

     

    “(a)           Qualmax
      shall be entitled at all times until the 2009 annual meeting of the stockholders
      of the Company to designate two (2) individuals (the “Qualmax Nominees”)
      to serve as directors, which Qualmax Nominees shall initially be M. David Kamrat
      and Noah Kamrat.  Noah Kamrat shall be a Class II director and M.
      David Kamrat shall be a Class III director.  Duy
      Tran previously resigned as a director.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    “(b)           P&S
      shall be entitled at all times until the 2009 annual meeting of the stockholders
      of the Company to designate three (3) individuals (the “P&S
      Nominees”) to serve as directors, which P&S Nominees shall initially be
      Jacob M. Schorr, Ph.D, Selvin Passen, M.D. and Mark S. Kahan.  Mark S.
      Kahan shall serve as a Class I Director, Selvin Passen, M.D. shall serve as
      a
      Class II director, and Jacob M. Schorr, Ph.D shall serve as Class III
      director.

     

    “(c)           Pursuant
      to Section 3 hereof, the Qualmax Nominees and the P&S Nominees shall
      be elected by the Voting Stockholders (provided that such nominees remain
      willing to serve) such that the Qualmax Nominees and the P&S Nominees shall
      serve on the Board until the 2009 annual meeting of the stockholders of the
      Company (and in the Classes specified herein).

     

    “(d)           If,
      prior to an individual’s election to the Board, any individual designated to
      serve as a director shall be unable or unwilling to serve as a director, the
      group who designated any such individual to serve as a director pursuant to
      the
      provisions of this Section 2 shall be entitled to designate a replacement
      in accordance with the provisions of this Section 2 who shall then be
      elected a director.

     

    “(e)           No
      Voting Stockholder, nor any affiliate of any such Voting Stockholder, shall
      have
      any liability as a result of designating a person for election as a director,
      or
      for any act or omission by such designated person in his or her capacity as
      a
      director of the Company, nor shall any Voting Stockholder have any liability
      as
      a result of voting for any such designee in accordance with the provisions
      of
      this Agreement.”

     

    2.           Section
      4(d) of the Restated Original Voting Agreement shall be deleted in its
      entirety.  Any reference in the Restated Original Voting Agreement to
“TBTE” shall be replaced with “Dr. Passen”.  Sections 22(a) and 22(c)
      of the Restated Original Voting Agreement shall be deleted in their
      entirety.

     

    3.           Except
      as specifically amended hereby, the Restated Original Voting Agreement is hereby
      ratified and confirmed in all respects and shall remain in full force and
      effect.

     

    4.           To
      the extent of any inconsistency between the terms of the Restated Original
      Voting Agreement and this First Amendment, the terms of this First Amendment
      will control.  Each reference in the Restated Original Voting
      Agreement to “this Agreement,” “herein,” “hereunder” or words of similar import
      shall be deemed to be a reference to the Restated Original Voting Agreement
      as
      amended by this First Amendment, and the Restated Original Voting Agreement
      as
      so amended shall be read as a single, integrated document.

    

    5.           This
      First Amendment may be executed in two or more counterparts, and by the
      different parties hereto in separate counterparts, each of which when executed
      shall be deemed to be an original but all of which taken together shall
      constitute one and the same agreement.  Facsimile transmission of any
      signed original counterpart and/or retransmission of any signed facsimile
      transmission shall be deemed the same as the delivery of an
      original.  The introductory Recitals are incorporated into and made a
      substantive part of this First Amendment.

    

    [Signature
      page follows]

    

     

     

    

    
      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

    

    

     

    IN
      WITNESS WHEREOF, the parties hereto have executed this First Amendment as of
      the
      day and year first above written.

    

                    COMPANY:

    

                    NEW
      WORLD BRANDS,
      INC.

    

    

                    By:
/s/
      M. David
      Kamrat           

                    Name: M.
      David Kamrat

                    Title: CEO

    

                    VOTING
      STOCKHOLDERS:

    

                    QUALMAX,
      INC.

     

                    By:
/s/
      M. David
      Kamrat           

                    Name: M.
      David Kamrat

                    Title: CEO

    

                    P&S
      SPIRIT,
      LLC

    

    

                    By:
      /s/
Selvin Passen,
      M.D.           

                    Name:
Selvin
      Passen, M.D.

                    Title:  
      Manager

    

                    SELVIN
      PASSEN,
      M.D.

    

    

                    By:
/s/
      Selvin
      Passen,
      M.D.                                                      

                    Selvin
      Passen,
      M.D.

    

                    OREGON
      SPIRIT,
      LLC

    

    

                    By:
/s/
      Selvin Passen,
      M.D.           

                    Name:
Selvin
      Passen, M.D.

                    Title:  
      Manager

    

    

    [signatures
      continued]

     

     

    
 

    
      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

    

     

    
 

                   

                     Acknowledged
      and agreed:

    

    

                    /s/
      M. DAVID
      KAMRAT

                    M.
      DAVID
      KAMRAT

    

    

                    /s/
      NOAH
      KAMRAT

                    NOAH
      KAMRAT

    

    

                    /s/
      JANE
      KAMRAT

                    JANE
      KAMRAT

    
 

                    /s/
      TRACY
      HABECKER

                    TRACY
      HABECKER

    

     

    

     

    

    4

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