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EXHIBIT 4.1

ANNEX I

TO

SECURITIES PURCHASE AGREEMENT

<PROTOTYPE FOR EACH ISSUANCE>

FORM OF DEBENTURE

	 	 	 	THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY
NOT BE SOLD OR OFFERED FOR SALE IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES OR AN OPINION OF COUNSEL
OR OTHER EVIDENCE ACCEPTABLE TO THE COMPANY THAT SUCH REGISTRATION
IS NOT REQUIRED.

	 	 	 
	NNo._____1 ______

	 	US $___________

6% SECURED CONVERTIBLE DEBENTURE DUE JUNE 1, 2004

     THIS DEBENTURE is one of a duly authorized issue of up to $1,000,000 in
Debentures of URANIUM POWER CORPORATION a corporation organized and existing

under the laws of the State of Colorado (the “Company”) designated as its 6%
Secured Convertible Debentures.

     FOR
VALUE RECEIVED, the Company promises to pay to             , the registered holder hereof (the “Holder”), the principal sum
of              and 00/100 Dollars (US $              ) on June 1, 2004 (the “Maturity Date”) and to pay interest on the
principal sum outstanding from time to time in arrears at the rate of 6% per
annum, accruing from      ,
20042, the date of initial issuance
of this Debenture (the “Issue Date”), on the date (each, an “Interest Payment
Date”) which is the earlier of (i) a Conversion Date (as defined below) or (ii)
the Maturity Date, as the case may be. Accrual of interest shall commence on
the first such business day to occur after the Issue Date and shall continue to
accrue on a daily basis until payment in full of the principal sum has been
made or duly provided for. Additional provisions regarding the payment of
interest are provided in Section 4(D) below.

     This Debenture is being issued pursuant to the terms of the Securities
Purchase Agreement, dated January 6, 2004 (the “Securities Purchase
Agreement”), to which the Company and the Holder (or the Holder’s predecessor
in interest) are parties. Capitalized terms not otherwise defined herein shall
have the meanings ascribed to them in the Securities Purchase Agreement.

     This Debenture is subject to the following additional provisions:

	1	 	Insert unique Debenture number for each issuance.
	 
	2	 	Insert the Closing Date.

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     1. The Debentures will initially be issued in denominations determined by
the Company, but are exchangeable for an equal aggregate principal amount of
Debentures of different denominations, as requested by the Holder surrendering
the same. No service charge will be made for such registration or transfer or
exchange.

     2. The Company shall be entitled to withhold from all payments of
principal of, and interest on, this Debenture any amounts required to be
withheld under the applicable provisions of the United States and Canadian
income tax laws or other applicable laws at the time of such payments, and
Holder shall execute and deliver all required documentation in connection
therewith.

     3. This Debenture has been issued subject to investment representations of
the original purchaser hereof and may be transferred or exchanged only in
compliance with the Securities Act of 1933, as amended (the “Act”), and other
applicable state and foreign securities laws and the terms of the Securities
Purchase Agreement . In the event of any proposed transfer of this Debenture,
the Company may require, prior to issuance of a new Debenture in the name of
such other person, that it receive reasonable transfer documentation that is
sufficient to evidence that such proposed transfer complies with the Act and
other applicable state and foreign securities laws and the terms of the
Securities Purchase Agreement. Prior to due presentment for transfer of this
Debenture, the Company and any agent of the Company may treat the person in
whose name this Debenture is duly registered on the Company’s Debenture
Register as the owner hereof for the purpose of receiving payment as herein
provided and for all other purposes, whether or not this Debenture be overdue,
and neither the Company nor any such agent shall be affected by notice to the
contrary.

     4. A. (i) At any time on or after the Issue Date and prior to the time
this Debenture is paid in full in accordance with its terms (including without
limitation after the Maturity Date and after the occurrence of an Event of
Default, as defined below), the Holder of this Debenture is entitled, at its
option, subject to the following provisions of this Section 4, to convert this
Debenture at any time into shares of Common Stock of the Company at a
conversion price for each share of Common Stock (“Conversion Price”) equal to
the lower of (i) 70% of the average Closing Bid Price as reported, by
Bloomberg, LP for the five (5) trading days ending on the day prior to the
Conversion Date or (ii) $.45 per share. Notwithstanding the foregoing, until
the Maturity Date or the occurrence of an Event of Default hereunder, the
Conversion Price shall not be below $.15 per share.

               (ii) Notwithstanding any other provision of this Debenture to the
contrary, if, on the Maturity Date or the occurrence of an Event of Default
hereunder, there is an Unconverted Debenture (as defined below), the Holder
shall have the option to require payment of the principal and accrued interest
(through the actual date of payment) of Unconverted Debenture (the “Maturity
Amount”) either (i) in cash (and such cash shall be applied first to interest
and then to principal or (ii) to the extent not paid in cash as provided in
clause (i), by delivering to the Holder such number of Conversion Shares equal
to such unpaid Maturity Amount divided by the Conversion Price then in effect
(such Conversion Shares, the “Maturity Date Shares”). The option to pay any or
all of the Maturity Amount by the issuance of Maturity Date Shares shall be
subject to the following conditions: (x) the Registration Statement covering
such shares must be effective at the time the Maturity Date Shares are issued
and (y) the issuance

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of the Maturity Date Shares shall not exceed the amount
contemplated by Section 4(C) hereof. In addition the Holder shall be entitled
to benefits of the Security Interest as more particularly described in
paragraph 12 hereof.

          B. Conversion shall be effectuated by faxing a Notice of Conversion (as
defined below) to the Company as provided in this paragraph. The Notice of
Conversion shall be executed by the Holder of this Debenture and shall
evidence such Holder’s intention to convert this Debenture or a specified
portion hereof in the form annexed hereto as Exhibit A. If paid in Common Stock
as contemplated hereby, interest accrued or accruing from the Issue Date to the
relevant Interest Payment Date shall be paid in Common Stock at the Conversion
Price applicable as of such Interest Payment Date. No fractional shares of
Common Stock or scrip representing fractions of shares will be issued on
conversion, but the number of shares issuable shall be rounded to the nearest
whole share. The date on which notice of conversion is given (the “Conversion
Date”) shall be deemed to be the date on which the Holder faxes or otherwise
delivers the conversion notice (“Notice of Conversion”) to the Company so that
it is received by the Company on or before such specified date, provided that,
if such conversion would convert the entire remaining principal of this
Debenture, the Holder shall deliver to the Company the original Debentures
being converted no later than five (5) business days thereafter. Facsimile
delivery of the Notice of Conversion shall be accepted by the Company at
facsimile number (604) 687-8789; Attn: Thornton Donaldson and to (604) 606-7980
Attn: George Orr. Certificates representing Common Stock upon conversion
(“Conversion Certificates”) will be delivered to the Holder at the address
specified in the Notice of Conversion (which may be the Holder’s address for
notices as contemplated by the Securities Purchase Agreement or a different
address), via express courier, by electronic transfer or otherwise, within
three (3) business days (such third business day, the “Delivery Date”) after
the date on which the Notice of Conversion is delivered to the Company as
contemplated in this paragraph B, and, if interest is paid by Common Stock, the
Interest Payment Date. The Holder shall be deemed to be the holder of the
shares issuable to it in accordance with the provisions of this Section 4(B) on
the Conversion Date.

          C. Notwithstanding any other provision hereof or of any of the other
Transaction Agreements, in no event (except (i) as specifically provided herein
as an exception to this provision, or (ii) while there is outstanding a tender
offer for any or all of the shares of the Company’s Common Stock) shall the
Holder be entitled to convert any portion of this Debenture, or shall the
Company have the obligation to convert such Debenture (and the Company shall
not have the right to pay interest hereon in shares of Common Stock) to the
extent that, after such conversion or issuance of stock in payment of interest,
the sum of (1) the number of shares of Common Stock beneficially owned by the
Holder and its affiliates (other than shares of Common Stock which may be
deemed beneficially owned through the ownership of the unconverted portion of
the Debentures or other convertible securities or of the unexercised portion of
warrants or other rights to purchase Common Stock), and (2) the number of
shares of Common Stock issuable upon the conversion of the Debentures with
respect to which the determination of this proviso is being made, would result
in beneficial ownership by the Holder and its affiliates of more than 4.99% of
the outstanding shares of Common Stock (after taking into account the shares to
be issued to the Holder upon such conversion). For purposes of the proviso to
the immediately preceding sentence, beneficial ownership shall be determined in
accordance with
Section 13(d) of the Securities Exchange Act of 1934, as amended, except as
otherwise provided

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in clause (1) of such sentence. The Holder, by its
acceptance of this Debenture, further agrees that if the Holder transfers or
assigns any of the Debentures to a party who or which would not be considered
such an affiliate, such assignment shall be made subject to the transferee’s or
assignee’s specific agreement to be bound by the provisions of this Section
4(C) as if such transferee or assignee were the original Holder hereof.
Nothing herein shall preclude the Holder from disposing of a sufficient number
of other shares of Common Stock beneficially owned by the Holder so as to
thereafter permit the continued conversion of this Debenture.

          D. (i) Subject to the terms of Section 4(C) and to the other terms of this
Section 4(D), interest on the principal amount of this Debenture converted
pursuant to a Notice of Conversion shall be due and payable, at the option of
the Company, in cash or Common Stock on the Interest Payment Date.

               (ii) If the interest is to be paid in cash, the Company shall make such
payment within three (3) business days of the Interest Payment Date. If the
interest is not paid by such third business day, the interest must be paid in
Common Stock in accordance with the provisions of Section 4(D)(i) hereof,
unless the Holder consents otherwise in each specific instance.

               (iii) Notwithstanding the foregoing, the Company’s right to issue shares
in payment of such interest is applicable if, and only if, there is then in
effect a current Registration Statement covering the shares to be issued to the
Holder in payment of such interest.

               (iv) The number of shares of Common Stock to be issued in payment of such
interest shall be determined by dividing the dollar amount of the interest to
be so paid by the average of the Closing Bid Prices for the five (5) trading
days, as reported by Bloomberg, LP ending on the day prior to the Interest
Payment Such Common Stock shall be delivered to the Holder, or per Holder’s
instructions, on the Delivery Date for the related Conversion Certificates
pursuant to Section 4(B) hereof.

               (iv) Iv as per above?If the Company elects to have the interest paid in
cash, the Company shall make such payment within three (3) business days of the
Interest Payment Date. If such payment is not made in cash by such date, it
shall be deemed that, subject to the provisions of Section 4(C) hereof, the
Company has elected to pay the interest in stock, if, but only if, the
Registration Statement covering the shares being issued is effective on the
date such shares are issued.

     E. (i) The Company shall have the right to redeem all, but not less than
all of the Debentures for which a Notice of Conversion has not theretofore
been submitted by delivering a Notice of Redemption to the Holder of the
Debenture. Formatting

          (ii) The redemption price shall be calculated at 110% of the principal
amount of the Debenture, plus accrued and unpaid interest, and shall be paid to
the Holder within ten (10) business days from the date of the receipt of the
Notice of Redemption by wire transfer , except with respect to any Debentures
for which a Notice of Conversion is submitted to the
Company, within seven (7) business days of the Holder’s receipt of the
Company’s Notice of Redemption. .

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     5. Subject to the terms of the Securities Purchase Agreement, no provision
of this Debenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of, and interest on, this
Debenture at the time, place, and rate, and in the coin or currency, herein
prescribed. This Debenture and all other Debentures now or hereafter issued of
similar terms are direct obligations of the Company.

     6. No recourse shall be had for the payment of the principal of, or the
interest on, this Debenture, or for any claim based hereon, or otherwise in
respect hereof, against any incorporator, shareholder, officer or director, as
such, past, present or future, of the Company or any successor corporation,
whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the issue
hereof, expressly waived and released.

     7. All payments contemplated hereby to be made “in cash” shall be made in
immediately available good funds of United States of America currency by wire
transfer to an account designated in writing by the Holder to the Company
(which account may be changed by notice similarly given). All payments of cash
and each delivery of shares of Common Stock issuable to the Holder as
contemplated hereby shall be made to the Holder at the address last appearing
on the Debenture Register of the Company as designated in writing by the Holder
from time to time; except that the Holder can designate, by notice to the
Company, a different delivery address for any one or more specific payments or
deliveries.

     8. If, for as long as this Debenture remains outstanding, the Company
enters into a merger (other than where the Company is the surviving entity) or
consolidation with another corporation or other entity or a sale or transfer of
all or substantially all of the assets of the Company to another person
(collectively, a “Sale”), the Company will require, in the agreements
reflecting such transaction, that the surviving entity expressly assume the
obligations of the Company hereunder. Notwithstanding the foregoing, if the
Company enters into a Sale and the holders of the Common Stock are entitled to
receive stock, securities or property in respect of or in exchange for Common
Stock, then as a condition of such Sale, the Company and any such successor,
purchaser or transferee will agree that the Debenture may thereafter be
converted on the terms and subject to the conditions set forth above into the
kind and amount of stock, securities or property receivable upon such merger,
consolidation, sale or transfer by a holder of the number of shares of Common
Stock into which this Debenture might have been converted immediately before
such merger, consolidation, sale or transfer, subject to adjustments which
shall be as nearly equivalent as may be practicable. In the event of any such
proposed Sale, (i) the Holder hereof shall have the right to convert by
delivering a Notice of Conversion to the Company within fifteen (15) days of
receipt of notice of such Sale from the Company, except that Section 4(C) shall
not apply to such conversion.

     9. If, at any time while any portion of this Debenture remains
outstanding, the Company spins off or otherwise divests itself of a part of its
business or operations or disposes of all or of a part of its assets in a
transaction (the “Spin Off”) in which the Company, in addition to or in lieu of
any other compensation received and retained by the Company for such business,
operations or assets, causes securities of another entity (the “Spin Off
Securities”) to be issued to security holders of the Company, the Company shall
cause (i) to be reserved Spin Off Securities

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equal to the number thereof which
would have been issued to the Holder had all of the Holder’s Debentures
outstanding on the record date (the “Record Date”) for determining the amount
and number of Spin Off Securities to be issued to security holders of the
Company (the “Outstanding Debentures”) been converted as of the close of
business on the trading day immediately before the Record Date (the “Reserved
Spin Off Shares”), and (ii) to be issued to the Holder on the conversion of all
or any of the Outstanding Debentures, such amount of the Reserved Spin Off
Shares equal to (x) the Reserved Spin Off Shares multiplied by (y) a fraction,
of which (I) the numerator is the principal amount of the Outstanding
Debentures then being converted, and (II) the denominator is the principal
amount of the Outstanding Debentures

     10. If, at any time while any portion of this Debenture remains
outstanding, the Company effectuates a stock split or reverse stock split of
its Common Stock or issues a dividend on its Common Stock consisting of shares
of Common Stock, the Conversion Price and any other amounts calculated as
contemplated hereby or by any of the other Transaction Agreements shall be
equitably adjusted to reflect such action. By way of illustration, and not in
limitation, of the foregoing, (i) if the Company effectuates a 2:1 split of
its Common Stock, thereafter, with respect to any conversion for which the
Company issues shares after the record date of such split, the Conversion Price
shall be deemed to be one-half of what it had been immediately prior to such
split; (ii) if the Company effectuates a 1:10 reverse split of its Common
Stock, thereafter, with respect to any conversion for which the Company issues
shares after the record date of such reverse split, the Conversion Price shall
be deemed to be ten times what it had been calculated to be immediately prior
to such split; and (iii) if the Company declares a stock dividend of one share
of Common Stock for every 10 shares outstanding, thereafter, with respect to
any conversion for which the Company issues shares after the record date of
such dividend, the Conversion Price shall be deemed to be such amount
multiplied by a fraction, of which the numerator is the number of shares (10 in
the example) for which a dividend share will be issued and the denominator is
such number of shares plus the dividend share(s) issuable or issued thereon (11
in the example).

     11. The Holder of the Debenture, by acceptance hereof, agrees that this
Debenture is being acquired for investment and that such Holder will not offer,
sell or otherwise dispose of this Debenture or the shares of Common Stock
issuable upon conversion thereof except under circumstances which will not
result in a violation of the Act or any applicable state Blue Sky or foreign
laws or similar laws relating to the sale of securities.

     12. 12.1 As continuing security for the payment and performance of all
debts, liabilities and obligations hereunder of the Company to the Holder,
howsoever arising (present and future, absolute and contingent) (the
“Indebtedness”), the Company grants, assigns, mortgages, pledges and charges,
as and by way of a specific mortgage, pledge and charge, and grants a Security
Interest (the “Security Interest”) to and in favour of the Holder in the
undertaking of the Company and in all present and after acquired personal
property of the Company and in all proceeds and renewals thereof, accessions
thereto and substitutions therefor (the “Collateral”). The Company warrants
and acknowledges to and in favour of the Holder that:

(a) the parties intend the Security Interest hereby constituted in its
existing property to attach upon execution and delivery hereof;

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(b) the parties intend the Security Interest created in after-acquired
property of the Company to attach at the same time as it acquires rights in
the said after-acquired property; and

(c) value has been given.

          The Holder acknowledges that the Security Interest granted hereunder shall
rank pari passu with the Security Interests granted to the holders of other
debentures issued concurrently herewith.

     12.2 Until Default, or until the Holder provides written notice to the
contrary to the Company, the Company may deal with the Collateral in the
ordinary course of the Company’s business in any manner not inconsistent with
the provisions of this Agreement, provided that the Company may not, and agrees
that it will not, without the prior written consent of the Holder:

(a) Sell or dispose of any of the Collateral otherwise than for fair market
value in the ordinary course of the Company’s business as it is presently
conducted and for the purpose of carrying on that business, or

(b) Create or incur any Security Interest, lien, assessment, or encumbrance
upon any of the Collateral which ranks or purports to rank, or is capable
of being enforced in priority to or equally with the Security Interest
granted under this Agreement, except for other debentures issued
concurrently herewith and Purchase Money Security Interests and Leases
incurred in the ordinary course of the Company’s business.

     12.3 On Default:

(a) The Holder may seize or otherwise take possession of the Collateral or
any part thereof and sell the same by public or private sale at such price
and upon such terms as the Holder in its sole discretion may determine and
the proceeds of such sale less all costs and expenses of the Holder
(including costs as between a solicitor and its own client on a full
indemnity basis) shall be applied on the Indebtedness and the surplus, if
any, shall be disposed of according to law;

(b) The Holder has the right to enforce this Agreement by any method
provided for in this Agreement and as permitted by law, and to dispose of
the Collateral by any method permitted by law, including disposal by lease
or deferred payment;

(c) The Holder may appoint any person or persons to be a Receiver of any
Collateral, and may remove any person so appointed and appoint another in
his stead. The term “Receiver” as used in this Agreement includes a
Receiver-Manager;

(d) Any Receiver will have the power:

(i) To take possession of any Collateral and for that purpose to
take any proceedings, in the name of the Company or otherwise;

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(ii) To carry on or concur in carrying on the business of the
Company;

(iii) To sell or lease any Collateral;

(iv) To make any arrangement or compromise which it may think
expedient in the interest of the Holder;

(v) To pay all liabilities and expenses connected with the
Collateral, including the cost of insurance and payment of taxes or
other charges incurred in obtaining, maintaining possession of and
preserving the Collateral, and the same shall be added to the
Indebtedness and secured by the Collateral;

(vi) To hold as additional security any increase or profits
resulting from the Collateral;

(vii) To exercise all rights that the Holder has under this
Agreement or otherwise at law;

(viii) With the consent of the Holder in writing, to borrow money
for the purpose of carrying on the business of the The Company or
for the maintenance of the Collateral or any part thereof or for
other purposes approved by the Holder, and any amount so borrowed
together with interest thereon shall form a charge upon the
Collateral in priority to the Security Interest created by this
Agreement;

(ix) To enter into and to occupy any premises in which the Company
has any interest;

(e) The Company hereby appoints each Receiver appointed by the Holder to be
its attorney to effect the sale or lease of any Collateral and any deed,
lease, agreement or other document signed by a Receiver under his seal
pursuant hereto will have the same effect as if it were under the seal of
the Company;

(f) Any Receiver will be deemed to be the agent of the Company, and the
Company will be solely responsible for his acts or defaults and for his
remuneration and expenses, and the Holder will not be in any way
responsible for any misconduct or negligence on the part of any Receiver;

(g) Neither the Holder nor the Sheriff will be required to take any steps
to preserve any rights against other parties pursuant to any Chattel Paper,
Security, or Instrument constituting the Collateral or any part of it;

(h) Neither the Holder nor the Sheriff is required to keep Collateral
identifiable;

(i) The Holder may use the Collateral in any manner as it in its sole
discretion deems advisable.

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     13. This Debenture shall be governed by and construed in accordance with
the laws of the State of New York. Each of the parties consents to the
exclusive jurisdiction of the federal courts whose districts encompass any part
of the City of New York or the state courts of the State of New York sitting in
the City of New York in connection with any dispute arising under this
Agreement and hereby waives, to the maximum extent permitted by law, any
objection, including any objection based on forum non coveniens, to the
bringing of any such proceeding in such jurisdictions. To the extent determined
by such court, the Company shall reimburse the Holder for any reasonable legal
fees and disbursements incurred by the Holder in enforcement of or protection
of any of its rights under any of this Debenture.

     14. The Company and the Holder hereby waive a trial by jury in any action,
proceeding or counterclaim brought by either of the Parties hereto against the
other in respect of any matter arising out of or in connection with this
Debenture.

     15. The following shall constitute an “Event of Default”:

	 	a.	 	The Company shall default in the payment of
principal or interest on this Debenture due hereunder or any
other amount due, and, in any such instance, the same shall
continue for a period of five (5) business days; or

	 	b.	 	Any of the representations or warranties made by
the Company herein, in the Securities Purchase Agreement or
any of the other Transaction Agreements or in any certificate
or financial or other written statements heretofore or
hereafter furnished by the Company in connection with the
execution and delivery of this Debenture or the Securities
Purchase Agreement shall be false or misleading in any
material respect at the time made; or

	 	c.	 	Subject to the terms of the Securities Purchase
Agreement, the Company fails to authorize or to cause its
Transfer Agent to issue shares of Common Stock upon exercise
by the Holder of the conversion rights of the Holder in
accordance with the terms of this Debenture, fails to transfer
or to cause its Transfer Agent to transfer any certificate for shares of Common Stock issued to the Holder upon conversion of
this Debenture and when required by this Debenture or the
Registration Rights Agreement, and such transfer is otherwise
lawful, or fails to remove any restrictive legend on any
certificate or fails to cause its Transfer Agent to remove
such restricted legend, in each case where such removal is
lawful, as and when required by this Debenture, the Agreement
or the Registration Rights Agreement, and any such failure
shall continue uncured for ten (10) business days; or

	 	d.	 	The Company shall fail to perform or observe, in
any material respect, any other covenant, term, provision,
condition, agreement or obligation of any Debenture in this
series and such failure shall continue uncured for a
period of thirty (30) days after written notice from the
Holder of such failure; or

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	 	e.	 	The Company shall fail to perform or observe, in
any material respect, any covenant, term, provision,
condition, agreement or obligation of the Company under any of
the Transaction Agreements and such failure shall continue
uncured for a period of fourteen (14) days after written
notice from the Holder of such failure; or
	 
	 	f.	 	The Company shall (1) admit in writing its
inability to pay its debts generally as they mature; (2) make
an assignment for the benefit of creditors or commence
proceedings for its dissolution; or (3) apply for or consent
to the appointment of a trustee, liquidator or receiver for
its or for a substantial part of its property or business; or
	 
	 	g.	 	A trustee, liquidator or receiver shall be
appointed for the Company or for a substantial part of its
property or business without its consent and shall not be
discharged within sixty (60) days after such appointment; or
	 
	 	h.	 	Any governmental agency or any court of competent
jurisdiction at the instance of any governmental agency shall
assume custody or control of the whole or any substantial
portion of the properties or assets of the Company and shall
not be dismissed within sixty (60) days thereafter; or
	 
	 	i.	 	Any money judgment, writ or warrant of
attachment, or similar process in excess of Two Hundred
Thousand ($200,000) Dollars in the aggregate shall be entered
or filed against the Company or any of its properties or other
assets and shall remain unpaid, unvacated, unbonded or
unstayed for a period of sixty (60) days or in any event later
than five (5) days prior to the date of any proposed sale
thereunder; or
	 
	 	j.	 	Bankruptcy, reorganization, insolvency or
liquidation proceedings or other proceedings for relief under
any bankruptcy law or any law for the relief of debtors shall
be instituted by or against the Company and, if instituted
against the Company, shall not be dismissed within sixty (60)
days after such institution or the Company shall by any action
or answer approve of, consent to, or acquiesce in any such
proceedings or admit the material allegations of, or default
in answering a petition filed in any such proceeding; or
	 
	 	k.	 	The Company shall have its Common Stock suspended
from trading on, or delisted from, the Principal Trading
Market for in excess of ten (10) trading days; or
	 
	 	l.	 	Any event defined in another provision of this
Debenture as an Event of Default shall have occurred.

If an Event of Default shall have occurred, then, or at any time thereafter,
and in each and every such case, unless such Event of Default shall have been
waived in writing by the Holder (which waiver shall not be deemed to be a
waiver of any subsequent default) at the option of the Holder

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and in the
Holder’s sole discretion, the Holder may consider this Debenture immediately
due and payable (and the Maturity Date shall be accelerated accordingly),
without presentment, demand, protest or notice of any kinds, all of which are
hereby expressly waived, anything herein or in any note or other instruments
contained to the contrary notwithstanding, and the Holder may immediately
enforce any and all of the Holder’s rights and remedies provided herein or any
other rights or remedies afforded by law.

     15. Nothing contained in this Debenture shall be construed as conferring
upon the Holder the right to vote or to receive dividends or to consent or
receive notice as a shareholder in respect of any meeting of shareholders or
any rights whatsoever as a shareholder of the Company, unless and to the extent
converted in accordance with the terms hereof.

     16. In the event for any reason, any payment by or act of the Company or
the Holder shall result in payment of interest which would exceed the limit
authorized by or be in violation of the law of the jurisdiction applicable to
this Debenture, then ipso facto the obligation of the Company to pay interest
or perform such act or requirement shall be reduced to the limit authorized
under such law, so that in no event shall the Company be obligated to pay any
such interest, perform any such act or be bound by any requirement which would
result in the payment of interest in excess of the limit so authorized. In the
event any payment by or act of the Company shall result in the extraction of a
rate of interest in excess of a sum which is lawfully collectible as interest,
then such amount (to the extent of such excess not returned to the Company)
shall, without further agreement or notice between or by the Company or the
Holder, be deemed applied to the payment of principal, if any, hereunder
immediately upon receipt of such excess funds by the Holder, with the same
force and effect as though the Company had specifically designated such sums to
be so applied to principal and the Holder had agreed to accept such sums as an
interest-free prepayment of this Debenture. If any part of such excess remains
after the principal has been paid in full, whether by the provisions of the
preceding sentences of this Section or otherwise, such excess shall be deemed
to be an interest-free loan from the Company to the Holder, which loan shall be
payable immediately upon demand by the Company. The provisions of this Section
shall control every other provision of this Debenture.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

11

 

     IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed by an officer thereunto duly authorized.

	 	 	 
	Dated: _______________, 2004
	 	 
	 
	 	 
	

	 	URANIUM POWER CORPORATION
	 
	 	 
	

	 	Name:
	

	 	

	

	 	(Title):
	

	 	

12

 

                         EXHIBIT A

NOTICE OF CONVERSION

OF

6% SECURED CONVERTIBLE DEBENTURE DUE JUNE 1, 2004

(To be Executed by the Registered Holder in Order to Convert the Debenture)

	 	 
	FROM:

	(“Holder”)

	 
	DATE:

	(the “Conversion Date”)

	 	 	 
	RE:

	 	Conversion of $           principal amount (the “Converted Debenture”)
of the 6% Secured Convertible Debenture Due June 1, 2004 (the “Debenture”)
of URANIUM POWER CORPORATION (the “Company”) into            shares
(the “Conversion Shares”) of Common Stock (defined below)

CONVERSION DATE:

     The captioned Holder hereby gives notice to the Company, pursuant to the
Debenture of URANIUM POWER CORPORATION that the Holder elects to convert the
Converted Debenture into fully paid and non-assessable shares of Common Stock,
$0.001 par value (the “Common Stock”), of the Company as of the Conversion Date
specified above. Said conversion shall be based on the following Conversion
Price

	__	 	$           , representing the original Conversion Price (as defined in the Debenture)
	 
	__	 	$           , representing the original Conversion Price (as defined
in the Debenture), adjusted in accordance with the provisions of the
Debenture.

13

 

	 	 	Based on this Conversion Price, the number of Conversion Shares
indicated above should be issued in the following name(s):

	 	 	 	 	 
	 

	 	Name and Record Address
	 	Conversion Shares
	 
	

	 	

	 	

	

	 	

	 	

	

	 	

	 	

     It is the intention of the Holder to comply with the provisions of Section
4(C) of the Debenture regarding certain limits on the Holder’s right to convert
thereunder. Based on the analysis on the attached Worksheet Schedule, the
Holder believe this conversion complies with the provisions of said Section
4(C). Nonetheless, to the extent that, pursuant to the conversion effected
hereby, the Holder would have more shares than permitted under said Section,
this notice should be amended and revised, ab initio, to refer to the
conversion which would result in the issuance of shares consistent with such
provision. Any conversion above such amount is hereby deemed void and revoked.

     As contemplated by the Debenture and the Securities Purchase Agreement,
this Notice of Conversion is being sent by facsimile to the telecopier number
and officer indicated above.

     If this Notice of Conversion represents the full conversion of the
outstanding balance of the Converted Debenture, the Holder either (1) has
previously surrendered the Converted Debenture, duly endorsed, to the Company
or (2) will surrender (or cause to be surrendered) the Converted Debenture,
duly endorsed, to the Company at the address indicated above by express courier
within five (5) business days after delivery or facsimile transmission of this
Notice of Conversion.

     The certificates representing the Conversion Shares should be transmitted
by the Company to the Holder via express courier or by electronic transfer
within the time contemplated by the Debenture and Securities Purchase Agreement
after receipt of this Notice of Conversion (by facsimile transmission or
otherwise) to:

14

 

     As contemplated by the Debenture, the Company should also pay all accrued
but unpaid interest on the Converted Debenture to the Holder.

                         — If the Company elects to pay such interest in Common
Stock, as contemplated by and subject to the provisions of the
Debenture, such shares should be issued in the name of the Holder
and delivered in the same manner as, and together with, the
Conversion Shares.

                         — If the Company elects or is required to pay the interest
paid in cash, such payment should be made by wire transfer as
follows:

	 	 	 
	 

	 	

	

	 	(Print name of Holder)
	 
	 	 
	

	 	By:
	

	 	

	

	 	(Signature of Authorized Person)
	 
	 	 
	

	 	

	

	 	(Printed Name and Title)

15

 

NOTICE OF CONVERSION

WORKSHEET SCHEDULE

	 	 	 	 
	1. Current Common Stock holdings of Holder and Affiliates

	 	
	 
	 
	 	 	 
	2. Shares to be issued on current conversion(s) and other exercise(s)

	 	
	 
	 
	 	 	 
	3. Other shares to be issued on other current conversion(s) and
other current exercise(s)

	 	
	 
	 
	 	 	 
	4. Other shares eligible to be acquired within next 60 days
without restriction

	 	
	 
	 
	 	 	 
	5. Total [sum of Lines 1 through 4]

	 	
	 
	 
	 	 	 
	6. Outstanding shares of Common Stock*

	 	
	 
	 
	 	 	 
	7. Adjustments to Outstanding

	 	
	 
	 
	 	 	 
	     a. Shares known to Holder as previously issued
to Holder or others but not included in Line 6

	 	
	 
	 
	 	 	 
	     b. Shares to be issued per Line(s) 2 and 3

	 	
	 
	 
	 	 	 
	     c. Total Adjustments [Lines 7a and 7b]

	 	
	 
	 
	 	 	 
	8. Total Adjusted Outstanding [Lines 6 plus 76c]

	 	
	 
	 
	 	 	 
	9. Holder’s Percentage [Line 5 divided by Line 8]

	 	
	%
	 
	 	 	 
	[Note: Line 9 not to be above 4.99%]
	 	 	 

16

 

* Based on latest SEC filing by Company or information provided by executive
officer of Company, counsel to Company or transfer agent

17<PAGE>

EXHIBIT 10.27

                           PURCHASE AND SALE AGREEMENT

                                      AMONG

             VERMONT PURE SPRINGS, INC., VERMONT PURE HOLDINGS, LTD.

                                       AND

                              MICROPACK CORPORATION

                            Dated as of March 1, 2004
<PAGE>
                                TABLE OF CONTENTS
                                   OF EXHIBITS

<TABLE>
<S>                                                                                   <C>
ARTICLE I      DEFINITIONS.............................................................1
    1.1      Definitions...............................................................1
    1.2      Certain Interpretive Matters..............................................8
ARTICLE II     PURCHASE AND SALE.......................................................8
    2.1      Sale of Assets............................................................8
    2.2      Excluded Assets...........................................................9
    2.3      Assumed Liabilities and Obligations......................................10
    2.4      Excluded Liabilities.....................................................11
    2.5      Intercompany Obligations.................................................12
    2.6      No Offset................................................................12
    2.7      License..................................................................12
    2.8      Accounts Receivable......................................................12
ARTICLE III    THE CLOSING............................................................13
    3.1      Closing..................................................................13
    3.2      Purchase Price...........................................................13
    3.3      Closing Payment of Purchase Price........................................13
    3.4      Calculation of Closing Date Working Capital Amount; Post-Closing
             Adjustment...............................................................13
    3.5      Allocation of Purchase Price.............................................15
    3.6      Deliveries by Seller.....................................................15
    3.7      Deliveries by Buyer......................................................16
    3.8      Passage of Title.........................................................17
ARTICLE IV     REPRESENTATIONS AND WARRANTIES OF SELLER...............................17
    4.1      Organization; Qualification..............................................17
    4.2      Authority Relative to this Agreement.....................................17
    4.3      Consents and Approvals: No Violation.....................................18
    4.4      Financial Statements.....................................................18
    4.5      Undisclosed Liabilities..................................................19
    4.6      Absence of Certain Changes or Events.....................................19
    4.7      Title and Related Matters................................................19
    4.8      Leases...................................................................19
    4.9      Inventory................................................................20
    4.10     Accounts Receivable......................................................20
    4.11     Insurance................................................................20
    4.12     Environmental Matters....................................................21
    4.13     Employees................................................................23
    4.14     Labor Matters............................................................23
    4.15     ERISA: Benefit Plans.....................................................24
    4.16     Real Property............................................................25
    4.17     Fixed Assets.............................................................26
    4.18     Certain Contracts and Arrangements.......................................26
    4.19     Litigation and Claims....................................................26
</TABLE>
<PAGE>
<TABLE>
<S>                                                                                   <C>
    4.20     Permits..................................................................27
    4.21     Taxes....................................................................27
    4.22     Patents, Copyrights and Trademarks.......................................27
    4.23     Water Sources; Regulatory Matters........................................28
    4.24     Disclosure...............................................................28
ARTICLE V      REPRESENTATIONS AND WARRANTIES OF BUYER................................28
    5.1      Organization; Qualification..............................................29
    5.2      Authority Relative to this Agreement.....................................29
    5.3      Consents and Approvals: No Violation.....................................29
    5.4      Litigation and Claims....................................................30
    5.5      Financial Statements.....................................................30
    5.6      Undisclosed Liabilities..................................................30
ARTICLE VI     COVENANTS OF THE PARTIES...............................................30
    6.1      Conduct of Business Relating to the Purchased Assets.....................30
    6.2      Access to and Retention of Information...................................31
    6.3      Expenses.................................................................33
    6.4      Further Assurances; Cooperation..........................................33
    6.5      Public Statements........................................................33
    6.6      Consents and Approvals...................................................33
    6.7      Fees and Commissions.....................................................34
    6.8      Tax Matters: Prorations..................................................34
    6.9      Employees................................................................35
    6.10     Non-Competition and Non-Solicitation.....................................36
    6.11     [Intentionally Deleted]..................................................38
    6.12     Notices of Certain Events................................................38
ARTICLE VII    CONDITIONS.............................................................39
    7.1      Conditions to Obligations of Buyer.......................................39
    7.2      Conditions to Obligations of Seller and Parent...........................40
ARTICLE VIII   INDEMNIFICATION........................................................41
    8.1      Indemnification..........................................................41
    8.2      Defense of Claims........................................................42
    8.3      Limits on Indemnification................................................43
    8.4      No Third Party Beneficiary...............................................44
ARTICLE IX     TERMINATION............................................................44
    9.1      Termination..............................................................44
    9.2      Procedure and Effect of No-Default Termination...........................45
ARTICLE X      MISCELLANEOUS PROVISIONS...............................................45
    10.1     Amendment and Modification...............................................45
    10.2     Waiver of Compliance: Consents...........................................45
    10.3     Survival of Representations. Warranties. Covenants and Obligations.......46
    10.4     Notices..................................................................46
    10.5     Assignment...............................................................47
    10.6     Governing Law............................................................48
    10.7     Counterparts.............................................................48
    10.8     Severability.............................................................48
    10.9     Interpretation...........................................................48
</TABLE>
<PAGE>
<TABLE>
<S>                                                                                   <C>
    10.10    Disclosure Letters and Exhibits..........................................48
    10.11    Entire Agreement.........................................................49
    10.12    Bulk Sales Laws..........................................................49
</TABLE>
<PAGE>
EXHIBITS

Exhibit A    Form of Assignment and Assumption Agreement
Exhibit B    Form of Bill of Sale
Exhibit C    Form of FIRPTA Affidavit
Exhibit D    Form of Opinion from Seller's Counsel
Exhibit E    Form of Opinion from Buyer's Counsel
Exhibit F    Vermont Pure License Agreement
Exhibit G    Trademark Assignment
Exhibit H    Occupancy Agreement
Exhibit I    Pristine Agreement
Exhibit J    Packaging Agreement
Exhibit K    Side Letter Agreement
Exhibit L    Hidden Spring License Agreement
Exhibit M    Promissory Note
<PAGE>
                           PURCHASE AND SALE AGREEMENT

      THIS PURCHASE AGREEMENT dated as of March 1, 2004, by and among Vermont
Pure Holdings, Ltd., a Delaware corporation ("Parent"), Vermont Pure Springs,
Inc., a Delaware corporation and wholly-owned subsidiary of Parent ("Seller")
and MicroPack Corporation, a Delaware corporation ("Buyer"). Parent, Seller and
Buyer are referred to individually as a "Party," and collectively as the
"Parties."

                               W I T N E S S E T H

      WHEREAS, Parent is engaged through Seller, its wholly-owned subsidiary, in
the processing, bottling, marketing, producing, distribution and sale of natural
spring water to the retail channels of distribution in PET packages of one (1)
gallon or less (the "Business");

      WHEREAS, Buyer desires to purchase, and Seller desires to sell, transfer
and assign, those assets of the Business as further described herein (other than
the Excluded Assets), including without limitation, the real property, including
the springs, the manufacturing facility and related equipment located in
Randolph, Vermont and in connection therewith, Buyer has agreed to assume
certain liabilities of the Business, upon the terms and conditions hereinafter
set forth in this Agreement.

      NOW, THEREFORE, in consideration of the mutual covenants, representations,
warranties and agreements hereinafter set forth, and intending to be legally
bound hereby, the Parties agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

1.1   Definitions.

      As used in this Agreement, the following terms have the meanings specified
in this Section 1.1.

            "Accounts Receivable" means the accounts receivable of the Business
deemed as of the Effective Time to be collectible by the Seller.

            "Accounts Payable" means all of the trade accounts payable of the
Business as of the Effective Time.

            "Affiliate" has the meaning set forth in Rule 12b-2 of the General
Rules and Regulations under the Securities Exchange Act of 1934.

            "Agreement" means this Purchase and Sale Agreement together with the
Seller Disclosure Letter and the Exhibits hereto, as the same may be from time
to time amended.

            "Assignment and Assumption Agreement" means the Assignment and
Assumption Agreement between Seller and Buyer, in the form of Exhibit A hereto,
by which
<PAGE>
Seller shall assign the Seller's Agreements, the Transferable Permits and
certain other Purchased Assets to Buyer and whereby Buyer shall assume the
Assumed Liabilities and Obligations.

            "Assumed Contracts" has the meaning set forth in Section 2.1(d).

            "Assumed Liabilities and Obligations" has the meaning set forth in
Section 2.3.

            "Bad Debt Policy" has the meaning set forth in Section 4.10.

            "Benefit Plans" has the meaning set forth in Section 4.15(a).

            "Bill of Sale" means the Bill of Sale, in the form of Exhibit B
hereto, to be delivered by Seller to Buyer at the Closing, with respect to
certain of the Tangible Personal Property.

            "Business" has the meaning set forth in the Recitals.

            "Business Day" shall mean any day other than Saturday, Sunday and
any day on which banking institutions in the Commonwealth of Massachusetts are
authorized by law or other governmental action to close.

            "Buyer Disclosure Letter" has the meaning set forth in the preamble
to Article V.

            "Buyer Indemnitee" has the meaning set forth in Section 8.1(b).

            "Buyer's Required Regulatory Approvals" has the meaning set forth in
Section 5.3(b).

            "CERCLA" means the Federal Comprehensive Environmental Response,
Compensation, and Liability Act, as amended, 42 U.S.C. Sections 9601 et seq.

            "Closing" has the meaning set forth in Section 3.1.

            "Closing Date" has the meaning set forth in Section 3.1.

            "Closing Date Working Capital Amount" has the meaning set forth in
Section 3.2.

            "Closing Payment" has the meaning set forth in Section 3.3.

            "COBRA" means the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended, as codified in Section 4980B of the Code and Part 6 of
Subtitle B of Title I of ERISA.

            "Code" means the Internal Revenue Code of 1986, as amended.

            "Commercially Reasonable Efforts" means efforts which are designed
to enable a Party, directly or indirectly, to satisfy a condition to, or
otherwise assist in the consummation of, the transactions contemplated by this
Agreement and which do not require the performing Party to expend any funds or
assume any liabilities.
<PAGE>
            "Contracts" has the meaning set forth in Section 4.18(a).

            "Direct Claim" has the meaning set forth in Section 8.2(c).

            "Encumbrances" means any mortgages, pledges, liens, writs of
execution, or security interests of any kind.

            "Environmental Claim" means any and all pending or, to the Seller's
Knowledge, threatened administrative or judicial actions, suits, orders, claims,
liens, notices, notices of violation, demands, demand letters, consent
judgments, consent orders, consent agreements, investigations, complaints,
requests for information, proceedings, or other written communication, whether
criminal or civil, pursuant to or relating to any Environmental Law by any
person based upon, alleging, asserting, or claiming any actual or potential (a)
violation by Seller of, or liability of Seller under any Environmental Law, (b)
violation of any Environmental Permit by Seller, or (c) liability of Seller for
investigatory costs, cleanup costs, removal costs, remedial costs, response
costs, natural resource damages, property damage, personal injury, fines, or
penalties arising out of, based on, resulting from, or related to the presence,
release, or threatened release into the environment of any Hazardous Substances,
including, but not limited to, any location to which Hazardous Substances, or
materials containing such Hazardous Substances, were sent by Seller for
handling, storage, treatment, or disposal.

            "Environmental Condition" means a condition relating to or arising
or resulting from the failure to comply with any Environmental Law or the
presence or release to the environment of Hazardous Substances in violation of
any Environmental Law on or before the Closing Date, including any migration of
those Hazardous Substances through air, soil or groundwater regardless of when
such presence or release is discovered.

            "Environmental Laws" means all federal, state and local, civil and
criminal laws, regulations, rules, ordinances, codes, common laws, decrees,
judgments, judicial or administrative decisions, or judicial or administrative
orders relating to pollution or protection of the environment, natural resources
or human health and safety, including, without limitation, laws relating to
releases or threatened releases of Hazardous Substances (including, without
limitation, releases to ambient air, surface water, groundwater, land, surface
and subsurface strata) or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, release, transport, disposal or handling
of Hazardous Substances. "Environmental Laws" include, without limitation,
CERCLA, the Hazardous Materials Transportation Act (49 U.S.C. Sections 1801 et
seq.) , the Resource Conservation and Recovery Act (42 U.S.C. Sections 6901 et
seq.), the Federal Water Pollution Control Act (33 U.S.C. Sections 1251 et
seq.), the Clean Air Act (42 U.S. C. Sections 7401 et seq.) , the Toxic
Substances Control Act (15 U.S.C. Sections 2601 et seq.), the Oil Pollution Act
(33 U.S.C. Sections 2701 et seq.), the Emergency Planning and Community
Right-to-Know Act (42 U.S.C. Sections 11001 et seq.), the Occupational Safety
and Health Act (29 U.S.C. Sections 651 et seq.), and all other state or local
laws analogous to any of the above.

            "Environmental Permits" has the meaning set forth in Section
4.12(a).

            "ERISA" means the Employee Retirement Income Security Act of 1974,
as amended.
<PAGE>
            "ERISA Affiliate" means any trade or business (whether or not
incorporated) which is or ever has been under common control, or which is or
ever has been treated as a single employer, with the Seller under Section
414(b), (c), (n) or (o) of the Code.

            "ERISA Affiliate Plans" means any Benefit Plan to which Seller or
any ERISA Affiliate contributed.

            "Excluded Assets" has the meaning set forth in Section 2.2.

            "Excluded Liabilities" has the meaning set forth in Section 2.4.

            "FIRPTA Affidavit" means the Foreign Investment in Real Property Tax
Act Certification and Affidavit, in the form of Exhibit C hereto.

            "Governmental Authority" means any federal, state or local
governmental, regulatory or administrative agency, commission, department,
board, or other governmental subdivision, court, tribunal, arbitrating body or
other governmental entity.

            "Hazardous Substances" means (a) any petrochemical or petroleum
products (including crude oil or any fraction thereof), oil or coal ash,
radioactive materials, radon gas, asbestos in any form that is or could become
friable, urea formaldehyde foam insulation and transformers or other equipment
that contain dielectric fluid which may contain levels of polychlorinated
biphenyls; (b) any chemicals, materials or substances defined as or included in
the definition of "hazardous substances," "hazardous wastes," "hazardous
materials," "hazardous constituents," "restricted hazardous materials,"
"extremely hazardous substances," "toxic substances," "toxic wastes,"
"contaminants," "pollutants," "toxic pollutants" or words of similar meaning and
regulatory effect under any applicable Environmental Law; and (c) any other
compound, product, chemical, material or substance, which is prohibited, limited
or regulated by any Environmental Law.

            "Income Tax" means any federal, state, local or foreign Tax (a)
based upon, measured by or calculated with respect to income, profits or
receipts (including, without limitation, capital gains Taxes and minimum Taxes)
or (b) based upon, measured by or calculated with respect to multiple bases
(including, without limitation, corporate franchise taxes) if one or more of the
bases on which such Tax may be based, measured by or calculated with respect to,
is described in clause (a), in each case together with any interest, penalties,
or additions to such Tax.

            "Indemnifiable Loss" has the meaning set forth in Section 8.1(a).

            "Indemnifying Party" has the meaning set forth in Section 8.1(d).

            "Indemnitee" has the meaning set forth in Section 8.1(c).
<PAGE>
            "Intellectual Property" means those patents and patent rights,
trademarks and trademark rights, service marks, inventions, copyrights and
copyright rights and all pending applications with respect thereto, product
formulations, and the like owned by Seller and used or necessary for the
operation of the Purchased Assets or the Business, as set forth in Schedule 4.22
to the Seller Disclosure Letter, other than those constituting Excluded Assets.

            "Inventory" has the meaning set forth in Section 2.1(b).

            "Inventory Policy" has the meaning set forth in Section 4.9.

            "IRS" means the United States Internal Revenue Service or any
successor agency thereto.

            "Knowledge" means (a) with respect to Seller or Parent, the actual
knowledge, of the corporate officers or managerial representatives of Seller or
Parent listed on Schedule 1.1(a) to the Seller Disclosure Letter and (b) with
respect to Buyer, means the actual knowledge, of the corporate officers or
managerial representatives of Buyer listed on Schedule 1.1(b) to the Buyer
Disclosure Letter.

            "Material Adverse Effect" means any change (or changes taken
together) in the Business or the Purchased Assets taken as a whole that results
in, or is likely to result in, a quantifiable, material adverse effect on the
operation or financial condition of the Business or the Purchased Assets taken
as a whole; provided, however, in determining whether a Material Adverse Effect
has occurred, any change or changes attributable to (i) a change in financial or
securities markets or in economic, regulatory or political conditions generally,
including acts of war (whether or not declared), armed hostility or terrorism;
(ii) matters adversely affecting companies in the same or similar or related
industries; or (iii) the execution, public announcement, closing or existence of
this Agreement, shall not be considered in determining whether a Material
Adverse Effect has occurred.

            "Occupancy Agreement" means the Occupancy Agreement between Seller
and Buyer, in the form of Exhibit H hereto.

            "Packaging Agreement" means the Packaging Agreement between Seller
and Buyer, in the form of Exhibit J hereto.

            "Party" (and the corresponding term "Parties") has the meaning set
forth in the preamble.

            "PBGC" means the Pension Benefit Guaranty Corporation established by
ERISA.

            "Permits" has the meaning set forth in Section 4.20.

            "Permitted Encumbrances" means (i) statutory liens for Taxes or
other governmental charges or assessments not yet due or delinquent or that may
be thereafter paid without penalty; (ii) zoning, entitlement, conservation
restriction and other land use and environmental regulations by Governmental
Authorities, which do not, individually or in the aggregate, materially impair
the use of the property subject thereto in the Business as currently
<PAGE>
conducted; (iii) such state of facts as an accurate survey of the Real Property
would show; (iv) easements, covenants and restrictions of record, including,
without limitation, those disclosed in the title insurance policies made
available by the Seller to the Buyer; and (v) general utility, sewer and
drainage easements of record upon which any buildings on the Real Property do
not encroach.

            "Person" means any individual, partnership, limited liability
company, joint venture, corporation, trust, unincorporated organization, or
governmental entity or any department or agency thereof.

            "Products" means all products processed, manufactured, distributed
or sold by Seller as part of the Business in PET packages of one (1) gallon or
less, including all natural spring water, flavored water, and fluoridated water
sold by the Seller as part of the Business.

            "Promissory Note" means the Promissory Note of Buyer payable to
Seller in the original principal amount of Five Hundred Thousand Dollars
($500,000.00), in the form of Exhibit M hereto.

            "Promotional Accruals" means all customer rebates, discounts,
credits and other promotional amounts established or approved by Seller in
connection with the sale of Products.

            "Proprietary Information" of a Party means all information about the
Party or its Affiliates, including their respective properties or operations,
furnished or disclosed to the receiving Party or its Representatives by the
Party or its Representatives regardless of the manner or medium in which it is
furnished or disclosed, including information regarding the Purchased Assets or
the transactions contemplated by this Agreement. Proprietary Information does
not include information that (a) is or becomes generally available to the public
(other than as a result of a disclosure by the receiving Party or its
Representatives in violation of this Agreement), (b) was available to the
receiving Party on a non-confidential basis prior to its disclosure by the
disclosing Party or its Representatives, (c) becomes available to the receiving
Party on a non-confidential basis from a Person, other than the Party or its
Representatives, who is not otherwise bound by a confidentiality agreement with
the Party or its Representatives with respect to such information, or is not
otherwise under any obligation to the Party or any of its Representatives not to
transmit the information to the other Party or its Representatives, or (d) the
receiving Party can prove was independently developed by such Party.

            "Purchased Assets" has the meaning set forth in Section 2.1.

            "Purchase Price" has the meaning set forth in Section 3.2.

            "Real Property" has the meaning set forth in Section 2.1(a).

            "Representatives" of a Party means the Party and its Affiliates and
their directors, officers, employees, agents, partners, advisors (including,
without limitation, accountants, counsel, environmental consultants, financial
advisors and other authorized representatives).

            "Seller" has the meaning set forth in the preamble.
<PAGE>
            "Seller Disclosure Letter" has the meaning set forth in the preamble
to Article IV.

            "Seller's Agreements" has the meaning set forth in Section 4.18(a).

            "Seller's Indemnitee" has the meaning set forth in Section 8.1(a).

            "Seller's Required Regulatory Approvals" has the meaning set forth
in Section 4.3(b).

            "Side Letter Agreement" means the Side Letter between Timothy Fallon
and the Buyer in the form of Exhibit K hereto.

            "Subsidiary" when used in reference to any Person means any entity
of which such Person, directly or indirectly, owns or controls ordinary voting
power to elect a majority of the Board of Directors, or other Persons performing
similar functions to the Board of Directors, of such entity.

            "Tangible Personal Property" means all machinery, mobile or
otherwise, equipment (including computer hardware and communications equipment),
vehicles, tools, spare parts, fixtures, furniture and furnishings and other
personal property owned by the Seller located at the Real Property and used in
and necessary for the operation of the Business, including, without limitation,
the items of personal property which are part of the Randolph Facility as
described in Schedule 4.16 to the Seller Disclosure Letter, but specifically
excluding the equipment relating to the Seller's three (3) gallon and five (5)
gallon bottling lines as further described on Schedule 2.2 to the Seller
Disclosure Letter, which equipment is an Excluded Asset.

            "Tangible Personal Property Leases" means all leases of personal
property, set forth in Schedule 4.8 to the Seller Disclosure Letter.

            "Taxes" means all taxes, charges, fees, levies, imposts, penalties
or other assessments or similar charges in the nature of a tax imposed by any
federal, state, municipal or local or foreign taxing or governmental authority,
including, but not limited to, income, excise, real or personal property, sales,
transfer, franchise, payroll, withholding, social security, use, goods and
services, value added, capital, capital gains, alternative, net worth, profits,
employer health, gross receipts, license, stamp, occupation, employment or other
taxes, including any interest, penalties, fines or additions attributable
thereto.

            "Tax Return" means any return, report, information return,
declaration, claim for refund or other document (including any schedule or
related or supporting information) required to be supplied to any taxing
authority in connection with the determination, assessment, collection or
payment of Taxes including amendments thereto.

            "Termination Date" has the meaning set forth in Section 9.1(b)(ii).

            "Third Party Claim" has the meaning set forth in Section 8.2(a).
<PAGE>
            "Transferable Permits" means those Permits and Environmental Permits
identified in Schedule 4.20 to the Seller Disclosure Letter, which may be
transferred to Buyer without a filing with, notice to, consent or approval of
any Governmental Authority.

            "Transferred Employees" has the meaning set forth in Section 6.9(a).

            "Working Capital" has the meaning set forth in Section 3.4 (d).

            "Working Capital Adjustment" has the meaning set forth in Section
3.4 (b).

            "Working Capital Amount" means the final amount of Working Capital,
as adjusted pursuant to Section 3.4.

1.2   Certain Interpretive Matters.

      In this Agreement, unless the context otherwise requires, the singular
shall include the plural, the masculine shall include the feminine and neuter,
and vice versa. The term "includes" or "including" shall mean "including without
limitation." References to a Section, Article or Exhibit shall mean a Section,
Article or Exhibit of this Agreement, and reference to a given agreement or
instrument shall be a reference to that agreement or instrument as modified,
amended, supplemented and restated through the date as of which such reference
is made.

                                   ARTICLE II

                                PURCHASE AND SALE

2.1   Sale of Assets.

      Upon the terms and subject to the satisfaction of the conditions contained
in this Agreement, at the Closing, Seller will sell, assign, convey, transfer
and deliver to Buyer, free and clear of all Encumbrances (other than Permitted
Encumbrances), and Buyer will purchase and acquire from Seller or Parent, as
applicable, all of the Seller's or Parent's right, title and interest in and to
the Business and the goodwill associated therewith, together with the following
assets constituting, or used in and necessary for the operation of, the
Business, other than Excluded Assets, each as in existence at the Effective Time
(collectively, "Purchased Assets"):

            (a) the right, title and interest of Seller in and to the real
property located at (i) Route 66, Catamount Industrial Park, Randolph, Vermont,
(ii) Rogers Road, Randolph Vermont, and (iii) North Randolph Road, Randolph,
Vermont, including without limitation, the land and springs located thereon (as
more fully described in the deed(s) to be delivered to Buyer at Closing),
together with the right, title and interest of Seller in all buildings and
improvements located thereon and fixtures and other appurtenances thereto
(collectively, the "Real Property");

            (b) the inventory of Products, including raw materials, and finished
goods of Seller that as of the Effective Time are used or held for use in the
Business other than finished goods labeled for Store 24 and labels related to
products to be produced for Store 24 (the "Inventory");
<PAGE>
            (c) the machinery, equipment (including computer hardware and
communications equipment) of Seller and other fixed assets of the Business
located at the Real Property as of the Closing (but excluding the fixed assets
constituting an Excluded Asset);

            (d) the right, title and interest of Seller as of the Closing in, to
and under all Contracts that are listed on Schedules 4.8 and 4.18(a) to the
Seller Disclosure Letter, and all unfilled purchase orders for Products obtained
by the Seller in the ordinary course of business ("Assumed Contracts");

            (e) the right, title and interest of Seller as of the Closing in, to
and under the Intellectual Property listed on Schedule 4.22 to the Seller
Disclosure Letter.

            (f) the trade secrets, know how and goodwill owned by Seller as of
the Closing used in and necessary for the Business;

            (g) all of the following business information of Seller
(collectively, the "Business Information"):

                  (i) the following items used exclusively in the Business:
sales and marketing literature, contract forms, information manuals, promotional
materials, sales and advertising brochures;

                  (ii) subject to Section 6.2(b)(ii) the following items used in
the Business: sales records, accounting records, pricing information, customer
lists, vendor lists, that portion of current customer files and current vendor
files relating to the Business, correspondence with customers and suppliers
(both actual and prospective), that portion of customer history files and vendor
history files relating to the Business, technical materials, manufacturing
instructions, manufacturing process sheets, diagrams and product specifications;

            (h) personnel records of Transferred Employees plus all other
employee records in Seller's possession that relates to the Business or the
Transferred Employees;

            (i) the Transferable Permits of Seller as of the Closing relating to
the Business; and

            (j) the Accounts Receivable.

2.2   Excluded Assets.

      Notwithstanding anything to the contrary in this Agreement, nothing in
this Agreement will constitute or be construed as conferring on Buyer, and Buyer
is not acquiring, any right, title or interest in or to the following specific
assets which are associated with the Purchased Assets, but which are hereby
specifically excluded from the sale and the definition of Purchased Assets
herein and as to which Seller shall retain all right, title and interest (the
"Excluded Assets"):

            (a) cash and cash equivalents on hand and on deposit in bank
accounts;

            (b) any refund of costs or expenses borne by Seller attributable to
the period prior to the Closing Date;
<PAGE>
            (c) any rights that accrue or will accrue to Seller under this
Agreement or any exhibits hereto;

            (d) the corporate seal, minute books, stock books and other records
relating to the corporate organization of Seller and the general ledger and
other books of original entry of Seller;

            (e) the rights to any of Seller's claims for any Tax refunds for
taxes paid or owed by Seller;

            (f) all rights and claims of the Seller, whether mature, contingent
or otherwise, against third parties, whether in tort, contract or otherwise,
including causes of action, unliquidated rights and claims under or pursuant to
any warranties, representations or guarantees made by advertisers,
manufacturers, suppliers, insurers or vendors relating to the conduct of the
Business prior to the Closing Date;

            (g) any asserted or unasserted rights or claims that relate to the
Excluded Assets or the Excluded Liabilities; and

            (h) those assets set forth on Schedule 2.2 to the Seller Disclosure
Letter.

2.3   Assumed Liabilities and Obligations.

      On the Closing Date, Buyer shall deliver to Seller the Assignment and
Assumption Agreement pursuant to which Buyer shall assume and agree to discharge
when due, all of the following liabilities and obligations of Seller
(collectively, "Assumed Liabilities and Obligations") and Seller shall not be
obligated to pay, perform or discharge any such liabilities or obligations:

            (a) All liabilities and obligations of Seller under the executory
portion of Seller's Agreements that are executory as of the Effective Time and
under the Transferable Permits;

            (b) All liabilities and obligations associated with the Purchased
Assets with respect to Taxes for which Buyer is liable pursuant to Section
6.8(a) hereof;

            (c) With respect to the Purchased Assets, any Tax attributable to
the ownership, sale, operation or use of the Purchased Assets accruing on or
after the Effective Time, except for any Income Taxes attributable to income
received by Seller;

            (d) All Accounts Payable of Seller as determined in accordance with
Section 3.4;

            (e) The obligations and liabilities arising out of Buyer's conduct
of the Business after the Effective Time, including, without limitation, any and
all asserted or unasserted liabilities or obligations to third parties for
bodily or personal injury or tort, product return, warranty or similar
liabilities or obligations arising out of the ownership or operation of the
Purchased Assets or the sale of Products after the Effective Time (including,
without
<PAGE>
limitation, obligations and liabilities for refunds, adjustments, allowances,
damages, repairs, exchanges and returns);

            (f) The obligations and liabilities assumed by Buyer under Section
6.9; and

            (g) Any liability of Buyer arising out of a breach by Buyer of any
of its obligations under this Agreement, the Assignment and Assumption
Agreement, the Vermont Pure License Agreement, the Occupancy Agreement, the
Supply Agreement and the Packaging Agreement and the Promissory Note.

2.4   Excluded Liabilities.

      Buyer shall not assume or be obligated to pay, perform or otherwise
discharge the following liabilities or obligations (the "Excluded Liabilities"):

            (a) Any liabilities or obligations of Seller in respect of any
Excluded Assets or other assets of Seller which are not Purchased Assets;

            (b) With respect to the Purchased Assets, any Tax attributable to
the ownership, operation or use of Purchased Assets for taxable periods, or
portions thereof, ending before the Closing Date, except for Taxes for which
Buyer is liable pursuant to Section 6.8(a) hereof;

            (c) All liabilities and obligations under the non-executory portion
of Seller's Agreements that are not executory as of the Effective Time;

            (d) The obligations and liabilities arising out of the Seller's
conduct of the Business prior to the Effective Time, including, without
limitation, any and all asserted or unasserted liabilities or obligations to
third parties for bodily or personal injury or tort, product return, warranty or
similar liabilities or obligations arising out of the ownership or operation of
the Purchased Assets or the sale of Products prior to the Effective Time
(including, without limitation, obligations and liabilities for refunds,
adjustments, allowances, damages, repairs, exchanges and returns), other than
any liabilities or obligations which have been expressly assumed by Buyer under
Section 2.3;

            (e) Subject to Section 2.3 and Section 6.9, any obligations of
Seller to its employees or former employees for wages, overtime, employment
taxes, severance pay, "change of control" payments, transition payments in
respect of compensation, notice periods or similar benefits accruing or arising
prior to the Closing under any term or provision of any contract, plan,
instrument or agreement to which Seller is a party or by which Seller is bound,
or under any local, state or federal law;

            (f) Any liabilities or obligations of Seller arising out of any
claim, whether known or unknown, prior to the Effective Time by any government
agency or individual relating to their employment by Seller, or Seller's
employment practices, including but not limited to, claims of employment
discrimination, wrongful termination, breach of contract, unfair labor
practices, breach of any common law or other violation of local, state or
federal laws relating to employment;
<PAGE>
            (g) Any liabilities or obligations of Seller arising out of any
claim, suit, action, or proceeding by Nestle relating to certain inventory of
Seller for Private Label Store 24;

            (h) Any liability of Seller arising out of a breach by Seller of any
of its obligations under this Agreement, the Bill of Sale, the Assignment and
Assumption Agreement, the Hidden Spring License Agreement, the Occupancy
Agreement, the Pristine Agreement and the Packaging Agreement;

            (i) All liabilities for any breach by Seller or failure by Seller to
perform the Seller's Agreements existing prior to or as of the Effective Time,
except for the failure to obtain any consents to assign any of the Seller's
Agreements to Buyer; and

            (j) Any other liability or obligation of Seller not specifically
assumed under this Agreement, including any unrecorded liabilities and any
environmental liabilities covering the period prior to the Closing.

2.5   Intercompany Obligations.

      Notwithstanding any other provision hereof, any amount owed to the
Business by Seller, Parent or any of its Affiliates (collectively, "Post-Closing
Affiliates"), or owed by the Business to Seller, Parent or any Post-Closing
Affiliate, other than obligations to third parties directly attributable to the
conduct of business of the Business, shall not constitute Purchased Assets or
Assumed Liabilities and Obligations.

2.6   No Offset.

      Notwithstanding any other provision hereof or of applicable law to the
contrary, the Parties' respective obligations under any covenant in this
Agreement, including without limitation Buyer's obligations expressly provided
under Section 2.3, will not be subject to offset or reduction or otherwise
affected by reason of any actual or alleged breach of any representation,
warranty or covenant contained in this Agreement or any document contemplated by
or delivered in connection herewith or any right or alleged right to
indemnification hereunder or thereunder or any other matter whatsoever, except
as otherwise expressly provided herein or therein.

2.7   License.

      Seller for itself and its successors and assigns hereby grants to Buyer a
perpetual, royalty free license to use in connection with the Business all
Intellectual Property (other than trademarks and trademark rights), trade
secrets, know how and goodwill that are used in the operation of Parent or
Seller's business and that are also used in the operation of the Business. Such
license is transferable to any purchaser of the Business from Buyer.

2.8   Accounts Receivable.

      Buyer agrees to use commercially reasonable efforts to collect the
Accounts Receivable acquired from Seller hereunder.
<PAGE>
                                   ARTICLE III

                                   THE CLOSING

3.1   Closing.

      Upon the terms and subject to the satisfaction of the conditions contained
in Article VII of this Agreement, the sale, assignment, conveyance, transfer and
delivery of the Purchased Assets to Buyer, the payment of the Closing Payment to
Seller, and the consummation of the other respective obligations of the Parties
provided in this Agreement shall take place at a closing (the "Closing"), to be
held at the offices of Buyer's counsel at One Financial Center, Boston,
Massachusetts 02111, at 10:00 a.m. local time, or another mutually acceptable
time and location, on March 1, 2004, or on such other date as the Parties may
mutually agree. The date of Closing is hereinafter called the "Closing Date."
The Closing shall be effective for all purposes as of 12:01 a.m. on the Closing
Date (the "Effective Time").

3.2   Purchase Price.

      The Purchase Price for the Purchased Assets shall equal the sum of (i)
$8,750,000, plus (ii) the Working Capital Amount (collectively, the "Purchase
Price"). The Working Capital Amount shall equal (a) the dollar value of the
Inventory of the Business as of the Effective Time, based upon an Inventory
count of the Business to be completed after the close of business on the last
Business Day prior to the Closing Date and before the open of business on the
Closing Date; plus (b) the dollar value of the Accounts Receivable of the
Business as of the Effective Time; less (c) the allowance for doubtful accounts
and liability for Promotional Accruals as of the Effective Time; less (d) the
dollar value of the Accounts Payable of the Business as of the Effective Time
(the "Closing Date Working Capital Amount"), each determined in accordance with
generally accepted accounting principles based on Seller's past practices,
subject to computation and adjustment in accordance with the procedures set
forth in Section 3.4 hereof (as so adjusted, the "Working Capital Amount").

3.3   Closing Payment of Purchase Price.

      At the Closing, as a payment on account of the Purchase Price, Buyer shall
(a) pay or cause to be paid to Seller, by wire transfer of immediately available
funds denominated in U.S. dollars or by such other means as are agreed upon by
Seller and Buyer an amount equal to the sum of (i) $8,250,000 plus (ii) the
Closing Date Working Capital Amount; and (b) deliver the Promissory Note to the
Seller (collectively, the "Closing Payment").

3.4   Calculation of Closing Date Working Capital Amount; Post-Closing
      Adjustment.

            (a) In order to determine the total quantity of Inventory at the
Effective Time, Seller will complete after the close of business on the last
Business Day prior to the Closing Date and before the open of business on the
Closing Date, a physical count of the Inventory which Buyer will have the
opportunity to observe and during which Buyer or Buyer's accountant will conduct
test counts. Based upon the foregoing, the parties will agree in writing on the
Closing Date Working Capital Amount prior to Closing. Seller will deliver to
Buyer on the Closing Date (i) a listing and valuation of the Inventory, (ii) an
aged listing of Accounts Receivable as of the
<PAGE>
Effective Time, (iii) the amount of the allowance for doubtful accounts and
liability for Promotional Accruals, and (iv) an aged listing of Accounts
Payable. Seller shall certify that (i), (ii), (iii) and (iv) are true and
correct based on the Seller's books and records as of the Effective Time and, in
the case of (i), the physical count of the Inventory. The Closing Date Working
Capital Amount shall be computed utilizing such amounts.

            (b) After the Closing Date, Buyer and its accountants will be
permitted to conduct an audit of the Closing Date Working Capital Amount for the
purpose of determining whether any adjustment is necessary to the Closing Date
Working Capital Amount, in accordance with generally accepted accounting
principles based on Seller's past practices. During the same period, Seller
shall be permitted to review and examine its computation of the items referred
to in (iii) and (iv) of Section 3.4(a). As promptly as possible, but in any
event, within forty-five (45) days after the Closing Date (the "Adjustment
Review Period"), Buyer will deliver to Seller a schedule (the "Adjustment
Schedule") setting forth its calculation of the Working Capital Amount and the
difference between (i) the Closing Date Working Capital Amount and (ii) the
Working Capital Amount as calculated by Buyer (such difference the "Working
Capital Adjustment"). The Adjustment Schedule shall show each specific item that
Buyer proposes to adjust together with an explanation in reasonable detail of
the reasons for and the amount of Buyer's proposed Working Capital Adjustment.
Seller shall have the right to observe and comment upon the preparation of the
Adjustment Schedule. During the Adjustment Review Period, Buyer will promptly
notify Seller of any material adjustment(s) of which Buyer becomes aware and to
provide such supporting documentation relating to the proposed Working Capital
Adjustment as Seller may reasonably request. In the event of any adjustment or
dispute relating to the quality of the Inventory, Seller shall have the right to
inspect such Inventory and Buyer shall segregate and not dispose of such
Inventory until the Parties have resolved any disagreements with respect
thereto. The failure of Buyer to deliver the Adjustment Schedule within the
Adjustment Review Period shall constitute Buyer's acceptance of the Closing Date
Working Capital Amount as the Working Capital Amount. Within seven (7) days
after Seller's receipt of the Adjustment Schedule, Seller may notify Buyer in
writing that it disagrees with the Adjustment Schedule (the "Dispute Notice").
The Dispute Notice shall set forth in reasonable detail the respects in which
the Seller disagrees with any proposed change (each a "Disputed Item") and the
dollar amount or range of dollar amounts which Seller believes is or contains
the correct amount for each Disputed Item. In the event that Seller and Buyer
are unable to resolve any Disputed Item within thirty (30) days after delivery
of the Dispute Notice, they shall appoint the Burlington, Vermont office of KPMG
(the "Independent Accounting Firm") to resolve as promptly as possible all
Disputed Items that are still in dispute. The expenses of the Independent
Accounting Firm will be shared equally by the Seller and the Buyer. The
resolution of all such Disputed Items and the determination of the Working
Capital Amount by such Independent Accounting Firm shall be made in a written
report delivered to both parties and shall be final, conclusive and binding on
the parties. Seller and Buyer agree that the purpose of the retention of the
Independent Accounting Firm shall not include the conduct of the Independent
Accounting Firm's own independent audit of the Working Capital Adjustment,
Inventory, Accounts Receivable, allowance for doubtful accounts and liability
for Promotional Accruals, Accounts Payable, or the value of any of those items
that is not a Disputed Item but rather shall be limited to resolving the
Disputed Items presented to it and matters related thereto. Buyer and Seller
agree that judgment may be entered upon the determination of the Independent
Accounting Firm in any court having jurisdiction over the Party against which
such determination is to be
<PAGE>
enforced. Buyer and Seller agree that the procedures established by this Section
3.4 shall constitute the exclusive procedures for determining the Working
Capital Amount.

            (c) Within five (5) days after delivery of the report by such
Independent Accounting Firm or after the settlement of any dispute or within ten
(10) days following delivery of the Adjustment Schedule if no dispute exists,
payment shall be made (i) by the Seller equal to the amount that the Closing
Date Working Capital Amount is greater than the Working Capital Amount, or (ii)
by the Buyer equal to the amount that the Working Capital Amount is greater than
the Closing Date Working Capital Amount.

            (d) For purposes of calculating the Closing Date Working Capital
Amount, the Working Capital Amount and the Working Capital Adjustment, the term
"Working Capital" shall mean the sum of (i) Inventory and (ii) Accounts
Receivable, less (iii) the allowance for doubtful accounts and liability for
Promotional Accruals less (iv) Accounts Payable. In addition: (x) Accounts
Receivable shall not include (i) any receivables which shall have been referred
to an independent third party for collection, (ii) any accounts whose account
debtors shall have filed under any bankruptcy, insolvency or similar proceeding
or shall have consented or failed to object to such filing, (iii) the Keeper
Springs, Inc. accounts receivable, or (iv) otherwise in breach of the
representations and warranties set forth in Section 4.10; and (y) Inventory
shall (i) be valued based upon standard cost for raw materials and finished
goods calculated based on October 31, 2003 standards for labor and overhead
calculated in accordance with past practices and (ii) not include any Inventory
which is (a) obsolete (determined in accordance with the Inventory Policy), (b)
damaged, or (c) is otherwise in breach of the representations and warranties
contained in Section 4.9.

3.5   Allocation of Purchase Price.

      The parties agree that the Purchase Price shall be allocated to the
Purchased Assets in accordance with Schedule 3.5 to the Seller Disclosure
Letter. The parties acknowledge that such allocation (subject to post-Closing
adjustments for the Working Capital Amount) represents the fair market value of
the Assets and shall be binding upon the parties hereto for federal, state,
foreign and local tax purposes. Each party covenants to report gain or loss or
cost basis, as the case may be, in a manner consistent with Schedule 3.5 to the
Seller Disclosure Letter for federal, state and local tax purposes.

3.6   Deliveries by Seller.

      At the Closing, Seller will deliver, or cause to be delivered, the
following to Buyer:

            (a) The Bill of Sale, duly executed by Seller;

            (b) Copies of any and all governmental and other third party
consents, waivers or approvals obtained by Seller with respect to the transfer
of the Purchased Assets;

            (c) The opinion of counsel and officer's certificates required by
Section 7.1;

            (d) A warranty deed conveying the Real Property to Buyer, in a form
reasonably acceptable to the Buyer, duly executed and acknowledged by Seller, in
recordable
<PAGE>
form, and any owner's affidavits or similar documents (other than indemnity
agreements) reasonably required by the title company;

            (e) The Assignment and Assumption Agreement, duly executed by
Seller;

            (f) A FIRPTA Affidavit, duly executed by Seller;

            (g) A Certificate of Good Standing of each of Parent and Seller;

            (h) The License Agreement with respect to the trademark "Vermont
Pure" and "Vermont Pure Essence" in the form set forth as Exhibit F hereto (the
"Vermont Pure License Agreement"), duly executed by Parent;

            (i) The Trademark Assignment with respect to the trademark "Hidden
Spring" in the form set forth as Exhibit G hereto (the "Trademark Assignment"),
duly executed by Parent;

            (j) The Occupancy Agreement in the form set forth as Exhibit H
hereto (the "Occupancy Agreement"), duly executed by Parent and Crystal Rock
Spring Water Company, Inc.;

            (k) The Supply and Sublicense Agreement with respect to the right to
purchase spring water from Pristine Springs of Vermont, Inc. ("Pristine") in the
form set forth as Exhibit I hereto (the "Pristine Agreement"), duly executed by
Parent;

            (l) The Packaging Agreement in the form set forth as Exhibit J (the
"Packaging Agreement"), duly executed by Parent;

            (m) The Side Letter Agreement in the form set forth as Exhibit K
hereto (the "Side Letter Agreement"), duly executed by Timothy G. Fallon; and

            (n) All such other instruments of assignment, transfer or conveyance
as shall, in the reasonable opinion of Buyer and its counsel, be necessary to
transfer to Buyer the Purchased Assets, in accordance with this Agreement.

3.7   Deliveries by Buyer.

      At the Closing, Buyer will deliver, or cause to be delivered, the
following to Seller:

            (a) The Closing Payment, including the Promissory Note, duly
executed by Buyer;

            (b) The opinion of counsel and officer's certificates required by
Section 7.2;

            (c) The Assignment and Assumption Agreement, duly executed by Buyer;

            (d) The Supply Agreement, duly executed by Buyer;

            (e) The Vermont Pure License Agreement, duly executed by Buyer;
<PAGE>
            (f) The License Agreement, with respect to the trademark "Hidden
Spring" in the form set forth as Exhibit L hereto (the "Hidden Spring License
Agreement"), duly executed by Buyer;

            (g) The Occupancy Agreement, duly executed by Buyer;

            (h) The Pristine Agreement, duly executed by Buyer;

            (i) The Packaging Agreement, duly executed by Buyer;

            (j) A Certificate of Good Standing of Buyer; and

            (k) All such other instruments of assumption as shall, in the
reasonable opinion of Seller and its counsel, are necessary for Buyer to assume
the Assumed Liabilities and Obligations in accordance with this Agreement.

3.8   Passage of Title.

      Title to, risk of loss with respect to and all obligations to insure the
Purchased Assets shall pass to Buyer immediately upon consummation of the
Closing.

                                   ARTICLE IV

                    REPRESENTATIONS AND WARRANTIES OF SELLER

      Each of Parent and Seller hereby represents and warrants to Buyer, jointly
and severally, that the following statements contained in this Article IV are
true, complete and correct as of the date of this Agreement and will be true,
complete and correct in all material respects as of the Closing Date, except as
otherwise set forth in the disclosure letter delivered by Parent and Seller to
Buyer (the "Seller Disclosure Letter"):

4.1   Organization; Qualification.

      Each of Parent and Seller is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and has
all requisite corporate power and authority to own, lease, and operate its
properties and to carry on its business as it is now being conducted. Each of
Parent and Seller is duly qualified or licensed to do business as a foreign
corporation and is in good standing in each jurisdiction in which the Purchased
Assets owned, leased or operated by it or the nature of the Business makes such
qualification necessary, except in each case in those jurisdictions where the
failure to be so duly qualified or licensed and in good standing would not
create a Material Adverse Effect. Seller has heretofore delivered to Buyer
complete and correct copies of each of Parent's and Seller's respective
Certificates of Incorporation and Bylaws as currently in effect.

4.2   Authority Relative to this Agreement.

      Each of Parent and Seller has the requisite corporate power and authority
to execute and deliver this Agreement and the other documents and instruments
required to be executed hereby
<PAGE>
and to consummate the transactions contemplated hereby. The execution and
delivery of this Agreement and the other documents and instruments required to
be executed hereby and the consummation of the transactions contemplated hereby
have been duly and validly authorized by all necessary corporate action required
on the part of each of Parent and Seller. This Agreement has been, and the other
documents and instruments required to be executed hereby upon their execution by
Parent and Seller, as applicable, will be, duly and validly executed and
delivered by Parent and Seller, as applicable, and assuming that this Agreement
and the other documents and instruments required to be executed hereby
constitute a valid and binding agreement of Buyer, constitutes the legal, valid
and binding agreement of Parent and Seller, as applicable, enforceable against
them in accordance with its terms, except that such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other similar laws affecting or relating to the
enforcement of creditors rights generally or general principles of equity
(regardless of whether enforcement is considered in a proceeding at law or in
equity).

4.3   Consents and Approvals: No Violation.

            (a) Except as set forth in Schedule 4.3(a) to the Seller Disclosure
Letter, neither the execution and delivery of this Agreement and the other
documents and instruments required to be executed hereby by Parent and Seller
nor the consummation by Seller of the transactions contemplated hereby will (i)
conflict with or result in the breach or violation of any provision of the
Certificate of Incorporation or Bylaws of Seller or Parent, (ii) result in a
default by Seller (or give rise to any right of termination, cancellation or
acceleration) under any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, license, agreement or other instrument or obligation
to which Parent or Seller is a party or by which Parent or Seller, or any of the
Purchased Assets may be bound, except for such defaults (or rights of
termination, cancellation or acceleration) as to which requisite waivers or
consents have been obtained; or (iii) constitute violations of any order, writ,
injunction, decree, statute, rule or regulation applicable to Seller in relation
to the Business, or to any of the Purchased Assets.

            (b) Except as set forth in Schedule 4.3(b) to the Seller Disclosure
Letter (the filings and approvals referred to in Schedule 4.3(b) to the Seller
Disclosure Letter are collectively referred to as "Seller's Required Regulatory
Approvals"), no declaration, filing or registration by Seller with, or notice by
Seller to, or authorization, consent or approval by Seller of any governmental
or regulatory body or authority is necessary for the execution and delivery by
Seller or Parent of this Agreement and the other documents and instruments
required to be executed hereby nor the consummation by Parent or Seller of the
transactions contemplated hereby.

4.4   Financial Statements.

      Seller has delivered to Buyer complete and correct copies of the following
financial statements: (i) unaudited pro forma balance sheets of the Business as
of October 31, 2003, November 30, 2003 and December 31, 2003 and (ii) statements
of income for the fiscal periods then ended (collectively, the "Financial
Statements"). The Financial Statements have been prepared based on the books and
records of Seller and are in accordance with Seller's past practices. Except as
disclosed in Schedule 4.4 to the Seller Disclosure Letter, the Financial
<PAGE>
Statements present fairly in all material respects the financial position and
results of operations of the Business at the dates and for the periods covered.

4.5   Undisclosed Liabilities.

      There are no material liabilities or obligations of Seller of any nature,
whether fixed, contingent, accrued or otherwise, liquidated or unliquidated, and
whether due or to become due, in connection with the Business except (i)
liabilities set forth in or otherwise disclosed in Schedule 4.5 to the Seller
Disclosure Letter, (ii) liabilities reflected or reserved against and disclosed
in the Financial Statements, and (iii) liabilities which have arisen since the
date of the Financial Statements in the ordinary course of business consistent
in all material respects with past custom and practice of Parent and Seller.

4.6   Absence of Certain Changes or Events.

      Since October 31, 2003, except as set forth in Schedule 4.6 to the Seller
Disclosure Letter, there has not been (a) any Material Adverse Effect, (b) any
material damage, destruction or casualty loss to the Purchased Assets, taken as
a whole, whether or not covered by insurance, (c) any agreement, commitment or
transaction entered into by Seller not in the ordinary course of business that
is material to the ownership or operation of the Purchased Assets and remains in
full force and effect on the date hereof and that is not disclosed on a schedule
to the Seller Disclosure Letter, (d) any sale or disposition of any fixed assets
of the Business other than in the ordinary course of business of the Business,
and (e) any change in any accounting method, practice or policy used by the
Seller, except as required by generally accepted accounting principles.

4.7   Title and Related Matters.

      Except for Permitted Encumbrances, and except as listed or described on
Schedule 4.7 to the Seller Disclosure Letter, Seller has fee simple title to the
Owned Real Property to be conveyed by it hereunder free and clear of all
Encumbrances. Except for Permitted Encumbrances, and except as listed or
described on Schedule 4.7 to the Seller Disclosure Letter, Seller owns each of
the Purchased Assets not constituting Real Property that it owns free and clear
of all Encumbrances. The Seller has made available to the Buyer correct and
complete copies of all title insurance policies for the Owned Real Property in
Seller's possession.

4.8   Leases.

      Schedule 4.8 to the Seller Disclosure Letter lists all Tangible Personal
Property Leases to which Seller is a party and which (i) are to be transferred
and assigned to and assumed by Buyer on the Closing Date, (ii) cover all or any
part of any leased tangible personal property used exclusively in the Business
(other than Excluded Assets), and (iii) provide for annual payments of more than
$10,000. Except as set forth in Schedule 4.8 to the Seller Disclosure Letter,
(i) all such Tangible Personal Property Leases are valid, binding and
enforceable in accordance with their terms, except that such enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other similar laws affecting or relating to the
enforcement of creditors rights generally or general principles of equity
(regardless of whether enforcement is considered in a proceeding at law or in
equity), are in full force and
<PAGE>
effect and represent all leases which are necessary in the operation of the
Business, (ii) there are no existing defaults by Seller or to Seller's
Knowledge, any other party thereunder, (iii) no event has occurred which
(whether with or without notice, lapse of time or both) would constitute a
default by Seller or to Seller's Knowledge, any other party thereunder, and (iv)
all rent and other charges due and payable have been paid.

4.9   Inventory.

      Except as set forth in Schedule 4.9 to the Seller Disclosure Letter, all
of the Inventory consists of items of first quality and a quantity usable or
merchantable in the ordinary course of the Business based on the Seller's past
practices. Each item of such Inventory is valued in the October 31, 2003
Financial Statements in accordance with average cost accounting of the Seller,
with obsolescence determined in accordance with the Inventory policy set forth
in Schedule 4.9 to the Seller Disclosure Letter (the "Inventory Policy"). The
current level of Inventory is at a normal level for the continuation of the
Business in the ordinary course based on the Seller's past practices. The
Inventory does not consist of any goods held on consignment. Seller is not under
any obligation or liability with respect to accepting returns of items of
Inventory in the possession of its customers other than in the ordinary course
of business consistent with past practice and the policies of the Seller. Seller
has not committed to acquire Inventory for sale which is not of a quality and
quantity usable in the ordinary course of the Business within a reasonable
period of time based on Seller's past practices (except in order to satisfy the
representation in the third preceding sentence) nor has Seller changed the cost
of any Inventory except for (i) reductions to reflect any reduction in the cost
thereof to Seller since October 31, 2003 in the ordinary course of business,
(ii) reductions and increases responsive to normal competitive conditions and
consistent with Seller's past practices, and (iii) increases to reflect any
increase in the cost thereof to Seller in the ordinary course of business.

4.10  Accounts Receivable.

      Seller has delivered to Buyer a list and the aging of the Accounts
Receivable of the Business. All Accounts Receivable, after taking into account
the allowance for doubtful accounts and liability for Promotional Accruals, (a)
are valid and genuine, (b) arise out of bona fide sales and deliveries of goods,
performance of services or other transactions in connection with the Business,
(c) are not subject to defenses, set-offs or counterclaims other than normal
returns and allowances and Promotional Accruals, (d) have been billed and are
generally due within thirty (30) days of such billing, (e) are not subject to
dispute, right of off-set or counterclaim, other than Promotional Accruals, (f)
are owned by Seller, (g) are collectible within ninety (90) days in the ordinary
course of business of the Business, and (h) the Accounts Receivable of Seller
will be transferred to Buyer at Closing free of claims relating to their
ownership other than Promotional Accruals. Seller's allowance for doubtful
accounts has been determined in accordance with Seller's policy set forth in
Schedule 4.10 to the Seller Disclosure Letter (the "Bad Debt Policy").

4.11  Insurance.

      Schedule 4.11 to the Seller Disclosure Letter sets forth a list of all
policies of insurance insuring the Business. Except as set forth in Schedule
4.11 to the Seller Disclosure Letter, all material policies of fire, liability,
worker's compensation and other forms of insurance owned or
<PAGE>
held by Seller or Parent and insuring the Purchased Assets or the Business are
in full force and effect, all premiums with respect thereto covering all periods
up to and including the date of this Agreement have been paid (other than
retroactive premiums which may be payable with respect to comprehensive general
liability and worker's compensation insurance policies), and no notice of
cancellation or termination has been received with respect to any such policy
which was not replaced on substantially similar terms prior to the date of such
cancellation. Except as described in Schedule 4.11 to the Seller Disclosure
Letter, as of the date of this Agreement, neither Parent nor Seller, as
applicable, has been refused any insurance with respect to the Purchased Assets
or the Business.

4.12  Environmental Matters.

            (a) Except as disclosed in Schedule 4.12 to the Seller Disclosure
Letter or in the Phase I Environmental Site Assessment prepared by ENSR
International, December 2003 and the Bottled Spring Water Source Assessment by
ENSR International, December 2003, Seller, holds, and is and has been in full
compliance with, all permits, certificates, licenses, regulations and
governmental authorizations under Environmental Laws required for Seller to own
and operate the Purchased Assets, the Business and the Real Property
("Environmental Permits"), all such Environmental Permits are in full force and
effect, and are listed in Schedule 4.12 to the Seller Disclosure Letter, and
Seller is in full compliance with all Environmental Laws with respect to the
ownership and operation of the Purchased Assets, the Real Property and the
Business.

            (b) Except as disclosed in Schedule 4.12 to the Seller Disclosure
Letter or in the Phase I Environmental Site Assessment prepared by ENSR
International, December 2003 and the Bottled Spring Water Source Assessment by
ENSR International, December 2003, there are no Hazardous Substances present on
the Real Property in violation of any Environmental Law.

            (c) Except as disclosed in Schedule 4.12 to the Seller Disclosure
Letter or in the Phase I Environmental Site Assessment prepared by ENSR
International, December 2003 and the Bottled Spring Water Source Assessment by
ENSR International, December 2003, there are no Environmental Claims pending or,
to Seller's Knowledge, threatened against Seller relating in any way to any
Environmental Condition or any violation of Environmental Law and Seller has not
received any written request for information, or been notified that they are a
potentially responsible party, under CERCLA or any similar state law.

            (d) Except as disclosed in Schedule 4.12 to the Seller Disclosure
Letter or in the Phase I Environmental Site Assessment prepared by ENSR
International, December 2003 and the Bottled Spring Water Source Assessment by
ENSR International, December 2003, Seller has not been requested to enter into
or has not entered into or agreed to any obligation, consent decree or order
relating to compliance with any Environmental Law or to investigation or cleanup
of Hazardous Substances under any Environmental Law with respect to the
Purchased Assets, the Real Property or the Business.

            (e) Except as disclosed in Schedule 4.12 to the Seller Disclosure
Letter or in the Phase I Environmental Site Assessment prepared by ENSR
International, December 2003 and the Bottled Spring Water Source Assessment by
ENSR International, December 2003, there
<PAGE>
are no underground storage tanks, monochlorinated or polychlorinated biphenyls
("PCBs") or asbestos containing material on the Real Property or on or in any
improvements thereon.

            (f) Except as disclosed in Schedule 4.12 to the Seller Disclosure
Letter or in the Phase I Environmental Site Assessment prepared by ENSR
International, December 2003 and the Bottled Spring Water Source Assessment by
ENSR International, December 2003, no Hazardous Substances have ever been
stored, disposed, buried, spilled, leaked, discharged, emitted or released
(collectively, "Release") by Seller in, on, under, onto or from the Real
Property or the Business, in violation of any Environmental Law and there is not
any Environmental Condition or any other event, condition, circumstance,
activity, practice, incident, action or plan relating to periods prior to the
Closing Date which is reasonably expected to interfere with or prevent
compliance with any Environmental Permits or Environmental Law in connection
with the operation of the Business by Seller or otherwise form the basis for any
Environmental Claim.

            (g) Except as disclosed in Schedule 4.12 to the Seller Disclosure
Letter or in the Phase I Environmental Site Assessment prepared by ENSR
International, December 2003 and the Bottled Spring Water Source Assessment by
ENSR International, December 2003, Seller has not manufactured, generated,
stored, used, distributed, treated, dispersed, disposed of, transported,
arranged to be transported or disposed, or handled any Hazardous Substance in
violation of Environmental Law.

            (h) Schedule 4.12 to the Seller Disclosure Letter sets forth a true,
complete and correct list of all environmental reports, investigations and
audits in the possession, custody or control of, or otherwise known to the
Seller relating to the Real Property or the Business, whether conducted by or on
behalf of the Seller, either done at the initiative of Seller, or directed by a
Governmental Authority or a third party. Copies of such reports, investigation,
or audits in the possession or control of the Seller have been provided to
Buyer.

            (i) Except as set forth in Schedule 4.12, in accordance with all
Environmental Laws and any other state or local laws or regulations, and in a
timely manner, Seller has submitted all requisite documents, information and
completed applications for the renewal of its Bottled Water Permit to Operate,
WSID #8400, issued by the State of Vermont Agency of Natural Resources,
Department of Environmental Conservation, Water Supply Division ("Operating
Permit"). Seller has received oral or written notification from the appropriate
Governmental Agency that, despite expiration of the Operating Permit on January
24, 2004, Seller may continue to operate its Business pursuant to the expired
Operating Permit until a new operating permit is issued. There are no facts,
conditions, or circumstances at or in the Business or the Real Property, or
identified in the documents, information, or application submitted for the
renewal of the Operating Permit, that could be expected to prevent the
appropriate Governmental Authority from issuing a renewal of the Operating
Permit.

            (j) Seller represents and warrants that the monitoring well at the
Hidden Spring property in Randolph, Vermont and identified in the Phase I
Environmental Site Assessment, Vermont Pure Springs, Inc., prepared by ENSR
International, December 2003 (the "Monitoring Well"), was installed by Wagner,
Heindel and Noyes, Inc. in 1993 for the purposes of evaluating whether the
existing spring was capturing all the water that it could and whether additional
construction would improve the efficiency in capturing the water feeding the
spring.
<PAGE>
The Monitoring Well has not been used since 1993 and has never been used to test
the water for the presence of contaminants.

4.13  Employees.

      Schedule 4.13 to the Seller Disclosure Letter lists all of the present
employees of Seller employed in the Business at the Real Property and each such
employee's position, location, date of hire, and current annual salary rate or
hourly wage. Except as described in Schedule 4.13 to the Seller Disclosure
Letter or as previously disclosed to Buyer, Seller is not a party to nor is it
bound by any written employment agreement or consulting agreement with any
employee or former employee whose employment terminated within the last two
years (including with any management employee or officer of the Business).

4.14  Labor Matters.

      With respect to the ownership or operation of the Purchased Assets, except
to the extent set forth in Schedule 4.14 to the Seller Disclosure Letter (which
matters as they relate to Seller shall remain the sole responsibility of
Seller):

            (a) Seller to the best of its Knowledge is in compliance in all
      material respects with all applicable laws respecting employment and
      employment practices, terms and conditions of employment and wages and
      hours, including those laws pertaining to withholding requirements for
      income and other taxes, employment insurance, pay equity, health
      insurance, workers compensation and statutory pension plans and has not
      been notified to the contrary by any individual or government agency;

            (b) Seller is not a party to any collective bargaining agreement or
      other labor union contract applicable to persons employed by the Seller in
      the Business and currently there are no organizational campaigns,
      petitions or other unionization activities seeking recognition of a
      collective bargaining unit which could affect Seller with respect to
      employees in the Business;

            (c) Since January 31, 2001, Seller has not received written notice
      of any unfair labor practice complaint pending before the National Labor
      Relations Board or any other Governmental Authority;

            (d) There are no labor strikes, picketing, lock-outs, boycotts,
      slowdown, or stoppage or applications for declaration of successor
      employer or charges or similar disputes or labor-related proceedings
      actually pending or to Seller's Knowledge, threatened by any authorized
      representative of any union or other representative of employees against
      Seller; since January 31, 2001, Seller has not received notice that any
      representation petition respecting the employees of Seller has been filed
      with the National Labor Relations Board or notice that any similar filing
      has been made with any Governmental Authority; no arbitration or grievance
      proceeding arising out of or under collective bargaining agreements is
      pending against Seller; Seller has not experienced any primary work
      stoppage since January 31, 2001;
<PAGE>
            (e) There has not been asserted, nor are there pending or to
      Seller's Knowledge, threatened, charges, actions, or lawsuits alleging
      claims against Seller brought by any former employee, employee or
      potential employee of the Business relating in any way to their employment
      by Seller (or prospective employment) including, but not limited to,
      claims of discrimination in employment or employment practices, for any
      reason, including, without limitation, age, gender, race, religion or
      other legally protected category as well as any claim with respect to
      payment of wages, salary or overtime pay;

            (f) There are no pending, or to Seller's Knowledge, threatened
      penalty assessments against Seller relating to worker compensation
      benefits with respect to the Business and all such current assessments
      relating thereto that are due have been paid to date;

            (g) Seller has paid or will pay in full to all its employees, or has
      adequately accrued for such in accordance with GAAP, all wages, salaries,
      commissions, vacation pay, bonuses, benefits and other compensation
      payable by Seller to or on behalf of such employees;

            (h) Seller is not a party to, or otherwise bound by, any consent
      decree with, or citation by, any Governmental Authority relating to its
      employees or employment practices;

            (i) There is no charge or proceeding with respect to a violation of
      any occupational safety or health standards that has been asserted or is
      now pending or, to Knowledge of Seller, threatened with respect to the
      Seller; and

            (j) None of Seller's employment policies or practices with respect
      to the Business is currently being audited or investigated by any
      Governmental Authority.

4.15  ERISA: Benefit Plans.

            (a) Schedule 4.15(a) to the Seller Disclosure Letter sets forth a
true, complete and correct list of all material "employee benefit plans" (as
defined by Section 3(3) of ERISA), including multiemployer plans, as defined by
Section 3(37) of ERISA, and all other material written plans, agreements or
arrangements involving direct or indirect compensation, including, without
limitation, pension, retirement, profit-sharing or supplemental executive
retirement plans, severance benefits, medical, vision, dental or other health
benefits, life insurance, disability benefits, deferred compensation, bonuses,
stock options, stock purchase, phantom stock, stock appreciation or other forms
of incentive compensation or post-retirement compensation, maintained or with
respect to which contributions are currently made by Seller with respect to
current or former employees employed in the Business ("Benefit Plans").

            (b) Except as set forth in Schedule 4.15(a) to the Seller Disclosure
Letter, Seller and its ERISA Affiliates have fulfilled their respective
obligations under the minimum
<PAGE>
funding requirements of Section 302 of ERISA and Section 412 of the Code with
respect to each Benefit Plan subject to such provisions. To Seller's Knowledge,
each Benefit Plan has been maintained in accordance with its terms and is in
compliance in all material respects with the presently applicable provisions of
ERISA and the Code and the regulations and rulings promulgated thereunder.

            (c) There is no Benefit Plan of Seller or any Seller Affiliate as to
which the Buyer will become liable as a result of the transactions contemplated
by this Agreement. None of the Purchased Assets is subject to any Encumbrance in
favor of, or enforceable by, the PBGC, or otherwise with respect to any Seller
Benefit Plan.

4.16  Real Property.

            (a) Schedule 4.16 to the Seller Disclosure Letter contains a legal
description of the Real Property. Seller has made available to Buyer true and
complete copies of all deeds, current surveys, title insurance policies
currently in force and documents evidencing all Encumbrances with respect to the
Real Property in the possession of Seller. There are no Real Property leases
with respect to the Business.

            (b) Based solely on the zoning letter included in Schedule 4.16 to
the Seller Disclosure Letter, the current use of the Real Property is in
compliance in all material respects with all applicable zoning, building code,
safety code, subdivision and similar regulations, and since January 31, 2001,
Seller has not received written notice of any material alleged violation of the
foregoing. The consummation of the transactions contemplated hereby will not (i)
prevent Buyer from utilizing, in accordance with such zoning ordinances and
regulations, any or all of the Real Property following the Closing in
substantially the same manner as Seller is utilizing such Real Property as of
the Closing or (ii) require Buyer, as a condition of continuing such use, to
comply with any existing zoning or other similar ordinances or regulations
beyond or in addition to those to which Seller's use of the Real Property is
currently subject.

            (c) Seller has obtained all licenses and rights-of-way, including
proofs-of dedication, necessary to ensure vehicular and pedestrian ingress and
egress to and from the Real Property. There are no restrictions on entrance to
or exit from the Real Property to adjacent public streets and, to Seller's
Knowledge, no conditions that will result in the termination of the present
access from the Real Property to existing highways and roads, except
restrictions or conditions that would not materially impair Buyer's ability to
conduct the Business as currently conducted by the Seller at the Real Property.

            (d) All facilities located on the Real Property are supplied with
utilities and other services necessary for the operation of such facilities as
currently operated, including gas, electricity, water, telephone, sanitary sewer
and storm sewer, all of which services are adequate for their current uses and
are in accordance in all material respects with all applicable laws.

            (e) There is no pending, or to Seller's Knowledge, threatened
proceeding to change or redefine the zoning classification of all or any portion
of the Real Property in a manner that would materially interfere with the use of
such Real Property as heretofore used by Seller.
<PAGE>
            (f) All of the buildings and improvements constructed on the Real
Property are in serviceable condition and repair, subject to ordinary wear and
tear, and all mechanical and utility systems servicing such improvements are in
serviceable condition and repair, subject to ordinary wear and tear.

            (g) Each parcel of Real Property is an independent unit which does
not rely on any facilities (other than the facilities of public utility and
water companies) located on any other property (i) to fulfill any zoning,
building code or other municipal or governmental requirement, (ii) for
structural support or the furnishing of any essential building systems or
utilities, including but not limited to electric, plumbing, mechanical, heating,
ventilating, and air conditioning systems, or (iii) to fulfill the requirements
of any lease. No building or other improvement not included in the parcel relies
on any part of the parcel to fulfill any zoning, building code or other
municipal or governmental requirement or for structural support or the
furnishing of any essential building systems or utilities. Such parcel is
assessed by local property assessors as a tax parcel or parcels separate form
all other tax parcels.

4.17  Fixed Assets.

      Schedule 4.17 to the Seller Disclosure letter sets forth a list of the
fixed assets of Seller listed on Seller's books and records as of October 31,
2003 that are Tangible Personal Property. All fixed assets that are part of the
Purchased Assets are in good operating condition and repair, subject to normal
wear and tear, are useable in the ordinary course of business of the Business
consistent with past practice.

4.18  Certain Contracts and Arrangements.

            (a) Listed on Schedule 4.18(a) to the Seller Disclosure Letter are
all of the Contracts to which Seller is a party and which are to be transferred
to and assumed by Buyer on the Closing Date. Other than Excluded Assets, such
Contracts are all of the material contracts, agreements, licenses, and leases
that are material to the ownership of the Purchased Assets or operation of the
Purchased Assets or the Business, other than the Tangible Personal Property
Leases ("Contracts," and together with the Tangible Personal Property Leases,
the "Seller's Agreements") and which are to be transferred and assigned to Buyer
as of the Closing.

            (b) Except as disclosed in Schedule 4.18(b) to the Seller Disclosure
Letter, each of the Contracts (i) constitutes the legal, valid and binding
obligation of Seller, (ii) is in full force and effect, and (iii) may (in the
case of the Contracts to which Seller is a party) be transferred or assigned to
Buyer at the Closing without consent or approval of the other parties thereto.

            (c) Except as set forth in Schedule 4.18(c) to the Seller Disclosure
Letter, there is not, under any of the Contracts, any default or event which,
with notice or lapse of time or both, would constitute a default on the part of
the Seller or to Seller's Knowledge, any other party thereto, except such events
of default and other events as to which requisite waivers or consents have been
obtained.

4.19  Litigation and Claims.
<PAGE>
      Except as disclosed in Schedule 4.19 to the Seller Disclosure Letter,
there is no action, suit or proceeding pending or, to Seller's Knowledge,
threatened in writing against Seller with respect to the Business before any
court, arbitrator or governmental or regulatory body or authority. Neither
Parent nor Seller is in default under the terms of any judgment, order or decree
of any Governmental Authority with respect to the Business or the Real Property,
except for such defaults that would not reasonably be expected to have a
Material Adverse Effect.

4.20  Permits.

            (a) Seller has all permits, licenses, franchises and other
governmental authorizations, consents, registrations and approvals, whether
federal, state, or municipal, used in or necessary for the ownership and
operation of the Purchased Assets or operation of the Business by Seller, except
where the failure to obtain any such Permit would not result in a Material
Adverse Effect (collectively, "Permits"). Except as set forth in Schedule 4.20
to the Seller Disclosure Letter, Seller has not received any written
notification that it is currently in violation in any material respect of any of
such Permits, or any law, statute, order, rule, regulation, ordinance or
judgment of any governmental or regulatory body or authority applicable to the
Business. Except as set forth in Schedule 4.20 to the Seller Disclosure Letter,
Seller is in compliance in all material respects with all Permits, laws,
statutes, orders, rules, regulations, ordinances, or judgments of any
governmental or regulatory body or authority applicable to the Purchased Assets
or the operation of the Business.

            (b) Schedule 4.20 to the Seller Disclosure Letter sets forth all
Permits and all Environmental Permits applicable to the Purchased Assets, and
identifies which of the foregoing are "Transferable Permits."

4.21  Taxes.

      Seller has paid or caused to be paid all Taxes, real estate taxes and
assessments due and owing on or prior to the date hereof on the Real Property
and no appeals relating to any such tax are pending. Except as set forth in
Schedule 4.21 the Seller Disclosure Letter, there are no outstanding agreements
or waivers extending the applicable statutory periods of limitation for Taxes
associated with the Purchased Assets for any period. Schedule 4.21 sets forth
the taxing jurisdictions in which Seller owns assets or conducts business and
has paid Taxes.

4.22  Patents, Copyrights and Trademarks.

      Schedule 4.22 to the Seller Disclosure Letter lists all the Intellectual
Property. To the Knowledge of the Seller, the conduct of the Business as
presently conducted does not conflict with or infringe upon any patents,
copyrights, trademarks, service marks or applications that are owned or to the
Knowledge of Seller, claimed by any third party. Seller lawfully owns or
possesses the right to use the Intellectual Property used in the conduct of the
Business, and, except as disclosed on Schedule 4.22 to the Seller Disclosure
Letter, Seller is not required to pay any royalty, license fee or similar type
of compensation with respect to such Intellectual Property. There is no claim or
demand of any Person pertaining to, or any proceeding that is pending or to the
Seller's Knowledge, threatened that challenges the rights of the Seller with
respect to the Intellectual Property. None of the Intellectual Property is
subject to any
<PAGE>
outstanding order, ruling, decree, judgment or stipulation by or with any court,
tribunal arbitrator or Governmental Authority.

4.23  Water Sources; Regulatory Matters.

            (a) Except as provided in Schedule 4.23 to the Seller Disclosure
Letter, with respect to each well, borehole or spring source (as applicable) on
the Real Property from which Seller currently draws water in bulk to be
formulated, processed or packaged as bottled water, Seller has sufficient legal,
contractual or other rights to permit them to take or draw such bulk water in
the ordinary course, without seasonal or volume limitations. All Products sold
by Seller and labeled as spring water or mineral water, flavored water,
fluoridated water have complied with applicable laws.

            (b) Seller has received approval from the Food and Drug
Administration ("FDA"), and under the Nutritional Labeling Education Act of 1990
("NLEA") or any other Governmental Authority of all registrations, applications,
licenses, requests for exemptions, permits and other regulatory authorizations
necessary to conduct the Business as currently conducted by Seller, the absence
of which would, individually or in the aggregate, have a Material Adverse Effect
on the Business. The Seller is, and since January 31, 1999 has been in
compliance with all such registrations, applications, licenses, requests for
exemptions, permits and other regulatory authorizations insofar as the same
pertain the manufacturing, processing, labeling and bottling of its Products.
The Seller is, and since January 31, 1999 has been, in compliance with all
material FDA, state and local rules and regulations, including but not limited
to, material FDA, state and local rules and regulations relating to health and
nutritional claims under the Fair Packaging and Labeling Act ("FPLA"), standards
established under the Safe Drinking Water Act and food labeling regulations
under the NLEA. Schedule 4.23 to the Seller Disclosure Letter sets forth a
complete and accurate list of any written communications (other than water flow
and water usage data) since January 31, 2001 between Seller, on the one hand,
and the FDA or any other Governmental Authority on the other hand that describe
matters that could have a Material Adverse Effect on the Business, attributable
to any of the Purchased Assets. The Seller has made available to Buyer copies of
all such documents, as well as copies of all complaints and other information
required to be currently maintained by Seller in accordance with rules and
regulations of the FDA and other Governmental Authority.

4.24  Disclosure.

      All agreements and schedules required to be delivered by or on behalf of
Seller pursuant to this Agreement are true, complete and correct.

                                   ARTICLE V

                     REPRESENTATIONS AND WARRANTIES OF BUYER

      Buyer hereby represents and warrants to Parent and Seller that the
following statements contained in this Article V are true, complete and correct
as of the date of this Agreement and will be true, complete and correct as of
the Closing Date, except as otherwise set forth in the disclosure letter
delivered by Buyer to Parent and Seller (the "Buyer Disclosure Letter"):
<PAGE>
5.1   Organization; Qualification.

      Buyer is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware and has all requisite corporate
power and authority to own, lease and operate its properties and to carry on its
business as is now being conducted. Buyer is duly qualified or licensed to do
business as a foreign corporation and is in good standing in each jurisdiction
in which the assets owned, leased or operated by it or the nature of its
business makes such qualification necessary, except in each case in those
jurisdictions where the failure to be so duly qualified or licensed and in good
standing would not create a Material Adverse Effect, Buyer has heretofore
delivered to Seller complete and correct copies of Buyer's Certificate of
Incorporation and By-laws as currently in effect.

5.2   Authority Relative to this Agreement.

      Buyer has the requisite corporate power and authority to execute and
deliver this Agreement, the Promissory Note and the other documents and
instruments required to be executed hereby and to consummate the transactions
contemplated hereby and thereby. The execution and delivery by Buyer of this
Agreement, the Promissory Note and the other documents and instruments required
to be executed hereby and the consummation of the transactions contemplated
hereby have been duly and validly authorized by all necessary corporate action
required on the part of Buyer. This Agreement has been, and the Promissory Note
and the other documents and instruments required to be executed hereby upon
their execution by Buyer will be, duly and validly executed and delivered by
Buyer, and assuming that this Agreement and the other documents and instruments
required to be executed hereby constitute a valid and binding agreement of
Seller, constitutes the legal, valid and binding agreement of Buyer, enforceable
against Buyer in accordance with its terms, except that such enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other similar laws affecting or relating to the
enforcement of creditors' rights generally or general principles of equity
(regardless of whether enforcement is considered in a proceeding at law or in
equity).

5.3   Consents and Approvals: No Violation.

            (a) Except as set forth in Schedule 5.3(a) to the Buyer Disclosure
Letter, neither the execution and delivery by Buyer of this Agreement, the
Promissory Note, and the other documents and instruments required to be executed
hereby nor the consummation by Buyer of the transactions contemplated hereby
will (i) conflict with or result in the breach or violation of any provision of
the Certificate of Incorporation or Bylaws of Buyer, (ii) result in a default by
Buyer (or give rise to any rights of termination, cancellation or acceleration)
under any of the terms, conditions or provisions of any note, bond, mortgage,
indenture, license, agreement or other instrument or obligation to which Buyer
is a party or by which Buyer, or any of its assets may be bound, except for such
defaults (or rights of termination, cancellation or acceleration) as to which
requisite waivers or consents have been obtained, or (iii) constitute violations
of any order, writ, injunction, decree, statute, rule or regulation applicable
to Buyer or to any of its assets.

            (b) Except as set forth in Schedule 5.3(b) to the Buyer Disclosure
Letter (the filings and approvals referred to in Schedule 5.3(b) to the Buyer
Disclosure Letter are
<PAGE>
collectively referred to as "Buyer's Required Regulatory Approvals"), no
declaration, filing or registration by Buyer with, or notice by Buyer to, or
authorization, consent or approval by Buyer of any governmental or regulatory
body or authority is necessary for the execution and delivery by Buyer of this
Agreement and the other documents and instruments required to be executed hereby
nor the consummation of the transactions contemplated hereby.

5.4   Litigation and Claims.

      There are no actions, suits or proceedings pending or, to Buyer's
Knowledge, threatened in writing against Buyer or its members before any court,
arbitrator or governmental or regulatory body or authority. Buyer is not subject
to any outstanding judgments, rules, orders, writs, injunctions or decrees of
any court, arbitrator or governmental or regulatory body or authority.

5.5   Financial Statements.

      Buyer has delivered to Seller the audited financial statements of the
Buyer as of and for the 12-month periods ended December 31, 2001 and December
31, 2002 and the unaudited balance sheet of the Buyer as of December 31, 2003
and statements of income for the 12-month period ended December 31, 2003
(collectively, the "Buyer Financial Statements"). The Financial Statements have
been prepared based on the books and records of the Buyer and are in accordance
with Buyer's past practices. Except as disclosed in Schedule 5.5 to the Buyer
Disclosure Letter, the Buyer Financial Statements present fairly in all material
respects the financial position and results of operations of the business of the
Buyer at the dates and for the periods covered. Since December 31, 2003, there
has been no material adverse change in the business, operations or financial
condition of Buyer, taken as a whole.

5.6   Undisclosed Liabilities.

      There are no material liabilities or obligations of Buyer of any nature,
whether fixed, contingent, accrued or otherwise, liquidated or unliquidated, and
whether due or to become due, except (i) liabilities set forth in or otherwise
disclosed in Schedule 5.6 to the Buyer Disclosure Letter, (ii) liabilities
reflected or reserved against and disclosed in the Buyer Financial Statements,
and (iii) liabilities which have arisen since the date of the Buyer Financial
Statements in the ordinary course of business consistent in all material
respects with past custom and practice of Buyer.

                                   ARTICLE VI

                            COVENANTS OF THE PARTIES

6.1   Conduct of Business Relating to the Purchased Assets.

      Except (i) in connection with or as a result of any matter listed or
described on any Schedule to the Seller Disclosure Letter; (ii) as expressly
contemplated by this Agreement; or (iii) to the extent Buyer otherwise consents
in writing, during the period from the date of this Agreement to the Closing
Date, Seller shall operate the Business in the ordinary course consistent with
past practice; shall use reasonable efforts to preserve intact the Purchased
Assets
<PAGE>
and preserve the relationships with customers, employees, suppliers and others
having business dealings with the Business with respect thereto; and shall
maintain the insurance coverage comparable to that described in Section 4.11.
Without limiting the generality of the foregoing, and, except as contemplated in
this Agreement or as described above, or as required under applicable law or by
any Governmental Authority, during the period from the date of this Agreement to
the Closing Date, without the prior written consent of Buyer, Seller will not,
with respect to the Business or the Purchased Assets:

            (a) Except for Permitted Encumbrances or existing Encumbrances,
sell, lease (as lessor), pledge, encumber, transfer or otherwise dispose of, or
grant any right with respect to, any of the Purchased Assets, other than assets
sold, leased, pledged, encumbranced, transferred, disposed of, used, consumed or
replaced in the ordinary course of business consistent with past practices;

            (b) Modify or amend in any material respect or voluntarily terminate
prior to the expiration date thereof any of Seller's Agreements or any Permit or
Environmental Permits or waive in any material respect any default by, or
release, settle or compromise any claim against, any other party thereto, other
than (i) in the ordinary course of business, to the extent consistent with past
practices, or (ii) as may be required in connection with Seller's obligations to
Buyer under this Agreement;

            (c) Amend in any material respect or cancel any liability or
casualty insurance policies related thereto, or fail to maintain by self
insurance or with financially responsible insurance companies insurance in such
amounts and against such risks and losses as are customary for such assets and
business other than in connection with any general renewal or revision of
Seller's insurance policies or practices;

            (d) Enter into any commitment or contract to purchase goods or
services not addressed in clauses (a) and (b) above that will be delivered or
provided after the Closing Date or such other date that the parties mutually
agree to be the date on which the Closing is expected to occur that exceeds
$25,000 individually, unless such commitment or contract is terminable by Seller
(or after the Closing Date by Buyer) without further liability, upon not more
than 30 days' notice;

            (e) (i) Hire any new employees of the Business, or transfer any
existing employees of the Business, other than to fill vacancies in existing
positions, (ii) enter into any employment or consulting agreement, or increase
salaries or wages of employees of the Business, except in the ordinary course of
business, (iii) enter into any collective bargaining or representation agreement
for employees of the Business, or (iv) take any action to increase the aggregate
benefits payable to employees of the Business, except in the ordinary course of
business or pursuant to preexisting commitments; or

            (f) Enter into any written or oral contract, agreement, commitment
or arrangement with respect to any of the transactions set forth in the
foregoing paragraphs (a) through (e).

6.2   Access to and Retention of Information.
<PAGE>
            (a) During the period from the date of this Agreement to the Closing
Date, Seller will, during ordinary business hours and upon reasonable notice to
Seller (i) give Buyer and its representatives reasonable access to all books,
records, plants, offices and other facilities and properties of Seller relating
to the Business or constituting the Purchased Assets, (ii) permit Buyer to make
such reasonable inspections thereof as Buyer may reasonably request, (iii)
provide access to the Seller's customers and suppliers with respect to the
Business, and (iv) furnish Buyer with such financial and operating data and
other information that is in Seller's possession with respect to the Seller, the
Business and the Purchased Assets as Buyer may from time to time reasonably
request. The access to information set forth in this Section 6.2(a) is expressly
conditioned upon Buyer's agreement (i) to treat all information viewed,
disclosed, reviewed or obtained in a confidential manner, and (ii) to use all
such information or knowledge of such information only for lawful purposes.

            (b) (i) For a period of seven (7) years after the Closing Date, each
Party and their respective Representatives shall have reasonable access to all
of the books and records (whether in paper or electronic form) relating to the
Purchased Assets or the Business in the possession of the other Party or Parties
to the extent that such access may reasonably be required by such Party in
connection with the Assumed Liabilities and Obligations or the Excluded
Liabilities, or any matters relating to or affected by the operation of the
Purchased Assets or the Business, the prosecution or defense of any claims or
demands or the preparation of any financial statements or the conduct of any
review or audit or any Tax matters. Such access shall be afforded by the Party
in possession of such books and records upon receipt of reasonable advance
notice and during normal business hours. In connection with the foregoing, Buyer
expressly agrees to reasonably cooperate with any information request by the
Seller for Tax or audit purposes relating to the operation of the Business or
the Purchased Assets prior to the Effective Date. The Party exercising this
right of access shall be solely responsible for any costs or expenses incurred
by it pursuant to this Section 6.2(b). If the Party in possession of such books
and records shall desire to dispose of any such books and records upon or prior
to the expiration of such seven-year period, such Party shall, prior to such
disposition, and provided that the disposal of such books and records shall not
be prohibited by law, give the other Party a reasonable opportunity at such
other Party's expense, to segregate and remove such books and records as such
other Party may select.

                  (ii) The parties agree that the Buyer shall maintain at all
times all accounting and financial records relating to the Business for the
current year and the two prior fiscal years and Seller shall have access to such
records until they are returned to Seller. By December 31, 2004, Buyer shall
return to the Seller such records relating to the Business for the fiscal year
ended December 31, 2002. By December 31, 2005, Buyer shall return to the Seller
such records relating to the Business for the year ended December 31, 2003 and
the period thereafter through the Closing Date.

            (c) Seller agrees (i) not to release any Person (other than Buyer)
from any confidentiality agreement now existing with respect to the Purchased
Assets, or waive or amend any provision of any such agreement and (ii) to assign
any rights arising under any such confidentiality agreement (to the extent
assignable) and relating only to the Purchased Assets to Buyer.
<PAGE>
            (d) The Party in possession of any books or records referred to in
this Section 6.2 shall be responsible for retaining such books and records in
accordance with applicable federal, state and local laws and regulations.

6.3   Expenses.

      Except to the extent specifically provided herein, whether or not the
transactions contemplated hereby are consummated, all costs and expenses
incurred in connection with this Agreement and the transactions contemplated
hereby shall be borne by the Party incurring such costs and expenses.
Notwithstanding anything to the contrary herein, Buyer will be responsible for
all costs and expenses associated with the obtaining of any title searches or
title insurance policy and all endorsements thereto that Buyer elects to obtain.

6.4   Further Assurances; Cooperation.

            (a) Subject to the terms and conditions of this Agreement, each of
the Parties hereto will use Commercially Reasonable Efforts to take, or cause to
be taken, all action, and to do, or cause to be done, all things necessary,
proper or advisable under applicable laws and regulations to consummate and make
effective the sale of the Purchased Assets pursuant to this Agreement, including
without limitation using Commercially Reasonable Efforts to ensure satisfaction
of the conditions precedent to each Party's obligations hereunder.
Notwithstanding anything in the previous sentence to the contrary, Seller, with
respect to the Transferable Permits, and Buyer, with respect to Permits and
Environmental Permits that are not Transferable Permits, shall use Commercially
Reasonable Efforts to obtain all Permits and Environmental Permits necessary for
Buyer to acquire and operate the Business. Neither of the Parties hereto will,
without the prior written consent of the other Party, take or fail to take any
action, which would reasonably be expected to prevent or materially impede,
interfere with or delay the transactions contemplated by this Agreement.

            (b) From time to time after the Closing Date, without further
consideration, Seller will, at its own expense, execute and deliver such
documents to Buyer as Buyer may reasonably request in order to more effectively
consummate the sale and purchase of the Purchased Assets or to more effectively
vest in Buyer good and marketable title to the Purchased Assets subject to the
Permitted Encumbrances. From time to time after the Closing Date, without
further consideration, Buyer will, at its own expense, execute and deliver such
documents to Seller as Seller may reasonably request in order to evidence
Buyer's assumption of the Assumed Liabilities and Obligations.

6.5   Public Statements.

      Prior to the Closing Date, the Parties shall consult with each other
before issuing any public announcement, statement or other disclosure with
respect to this Agreement or the transactions contemplated hereby and shall not
issue any such public announcement, statement or other disclosure prior to such
consultation, except as may be required by law or stock exchange rules.

6.6   Consents and Approvals.
<PAGE>
            (a) As promptly as practicable after the date of this Agreement,
Seller and Buyer, as applicable, shall file with any Governmental Authority
having jurisdiction over the Purchased Assets or the Business, any filings
required to be made with respect to the transactions contemplated hereby. The
Parties shall respond promptly to any requests for additional information made
by such agencies, and use their respective Commercially Reasonable Efforts to
cause regulatory approval to be obtained at the earliest possible date after the
date of filing. Each Party will bear its own costs of the preparation of any
such filing.

            (b) Seller and Buyer shall cooperate with each other and (i)
promptly prepare and file all necessary documentation, (ii) effect all necessary
applications, notices, petitions and filings and execute all agreements and
documents, (iii) use reasonable efforts to obtain the transfer or reissuance to
Buyer of all necessary consents, approvals and authorizations of all
Governmental Authorities and (iv) use reasonable efforts to obtain all necessary
consents, approvals and authorizations of all other parties, necessary to
consummate the transactions contemplated by this Agreement or required by the
terms of any note, bond, mortgage, indenture, deed of trust, license, franchise,
permit, concession, contract, lease or other instrument to which Seller or Buyer
is a party or by which any of them is bound. Seller and Buyer shall have the
right to review in advance all characterizations of the information relating to
the transactions contemplated by this Agreement which appear in any filing with
a Governmental Authority pursuant to this Section 6.6(b) made in connection with
the transactions contemplated hereby.

            (c) Subject to Section 3.6 of this Agreement, Seller and Buyer shall
cooperate with each other and promptly prepare and file notifications with, and
request Tax clearances from, state and local taxing authorities in jurisdictions
in which a portion of the Purchase Price may be required to be withheld or in
which Buyer would otherwise be liable for any Tax liabilities of Seller pursuant
to such state and local Tax law, as determined by Buyer in accordance with
Schedule 4.21 to the Seller Disclosure Letter.

            (d) Seller shall have the primary responsibility for securing the
transfer or reissuance of the transferable Permits. Buyer shall have the primary
responsibility for securing the issuance and procurement by Buyer of Permits and
Environmental Permits that are not Transferable Permits. Each Party shall
cooperate with the other Parties' efforts in this regard.

6.7   Fees and Commissions.

      Seller and Buyer each represent and warrant to the other that no broker,
finder or other Person is entitled to any brokerage fees, commissions or
finder's fees in connection with the transactions contemplated hereby by reason
of any action taken by the Party making such representation. Seller and Buyer
will pay to the other or otherwise discharge, and will indemnify and hold the
other harmless from and against, any and all claims or liabilities for all
brokerage fees, commissions and finder's fees incurred by reason of any action
taken by the indemnifying party.

6.8   Tax Matters: Prorations.

            (a) All real estate transfer taxes, all sales taxes and other
transfer taxes incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by Buyer (directly or by reimbursing Seller)
other than any tax liability resulting from the
<PAGE>
transfer of the Real Property from Seller to Buyer pursuant to this Agreement
incurred by Buyer pursuant to Section 7 of that certain Tax Stabilization
Agreement made as of the 21st day of September, 1999 by and between Seller and
the Town of Randolph, a Vermont municipal corporation. Seller will file, to the
extent required by applicable law, all necessary Tax Returns and other
documentation required by applicable law to be filed by Seller with respect to
all such transfer or sales taxes, subject to Buyer's approval, which approval
shall not be unreasonably withheld or delayed, and Buyer will be entitled to
review such returns and other documentation ten (10) Business Days in advance of
the due date for filing such Tax Returns and, if required by applicable law,
will join in the execution of any such Tax Returns. Prior to the Closing Date,
Seller will provide to Buyer, to the extent possible, and Buyer will execute and
deliver to Seller, an appropriate resale tax exemption certificate in connection
with this Agreement and the transactions contemplated hereby, due from each
applicable taxing authority.

            (b) Buyer and Seller shall provide each other with such assistance
as may reasonably be requested by the other Party in connection with the
preparation of any Tax Return, any audit or other examination by any taxing
authority, or any judicial or administrative proceedings relating to liability
for Taxes with respect to the Business, and each will retain and provide the
requesting Party with any records or information which may be relevant to such
return, audit or examination, proceedings or determination. Any information
obtained pursuant to this Section 6.8(b) or pursuant to any other Section hereof
providing for the sharing of information or review of any Tax Return or other
schedule relating to Taxes shall be kept confidential by the Parties hereto
other than as is legally required in connection with such Tax Return, audit or
examination.

            (c) In the event that a dispute arises between Seller and Buyer as
to the amount of Taxes covered by this Section 6.8, the Parties shall attempt in
good faith to resolve such dispute, and any amount so agreed upon shall be paid
to the appropriate party. If such dispute is not resolved thirty (30) days
thereafter, the Parties shall submit the dispute to the Independent Accounting
Firm, for resolution solely with respect to the disputed items, which resolution
shall be final, conclusive and binding on the Parties. Notwithstanding anything
in this Agreement to the contrary, the reasonable fees and expenses of the
Independent Accounting Firm in resolving any dispute pursuant to this Section
6.8(c) shall be borne equally by Seller and by Buyer. Any payment required to be
made as a result of the resolution of the dispute by the Independent Accounting
Firm shall be made within ten (10) days after such resolution.

            (d) Except as otherwise expressly provided herein, all charges for
utilities, rent, payments due under the Seller's Agreements, premiums on
insurance required by the Tangible Personal Property Leases, Property Taxes and
other similar charges of a recurring nature relating to the operation of the
Purchased Assets or the Business, shall be prorated as of the Effective Time,
and an appropriate payment or other adjustment to the Purchase Price shall be
made at the Closing or in determining the Working Capital Amount.

6.9   Employees.

            (a) Conditioned upon the occurrence of the Closing, Buyer will make
an offer of at-will employment, effective as of the Effective Time, to at least
thirty (30) employees of the Seller who are employed in the Business as of the
Closing Date, as determined by Buyer. Those employees who accept Buyer's offer
of employment shall be referred to herein as "Transferred
<PAGE>
Employees." Buyer will offer employment to such employees at their current
salaries and with benefits comparable to those currently provided to Buyer's
other employees. In the event Buyer terminates the employment of such
Transferred Employees following the Effective Time and in so doing incurs
obligations under the WARN Act, Buyer agrees that it will provide the required
notices or otherwise meet its obligations under WARN. All offers of employment
made by Buyer pursuant to this Section 6.9(a) shall be made in accordance with
all applicable laws, rules and regulations.

            (b) The Transferred Employees shall be given credit for all service
with Seller under each fringe benefit and other employee benefit plan as defined
by Section 3(3) of ERISA, program and arrangement covering employees of Buyer
("Buyer Benefit Plans") in which a Transferred Employee becomes a participant,
subject to the terms and conditions of each such plan and the approval of any
applicable insurers. The service credit so given shall be for purposes of
eligibility, vesting, and level of benefits but not for benefit accrual under
any Buyer Benefit Plan that is subject to Title IV of ERISA ("Title IV Plan")
except to the extent provided under such Title IV Plan.

            (c) Prior to the Closing Date, Seller shall permit Buyer to review
employee performance, job description and other relevant information (other than
information which Seller is prohibited by law from disclosing) in Seller's
possession which Buyer deems necessary to determine which of Seller's employees
will be offered continued employment in accordance with Section 6.9(a), provided
that Buyer shall keep such information confidential and use it only for lawful
purposes. Promptly after the Closing, Seller shall deliver to Buyer the
personnel records and files of Seller for the Transferred Employees, and Seller
shall have access to such records and files following Closing in accordance with
Section 6.2(b).

            (d) Seller has paid or will pay in full to all its employees, or has
adequately accrued for such in accordance with GAAP, all wages, salaries,
commissions, vacation pay, bonuses, benefits and other compensation payable by
Seller on or before the Effective Time to or on behalf of such employees.

6.10  Non-Competition and Non-Solicitation.

            (a) Non-Competition. From the Closing Date until the fifth (5th)
anniversary thereof (the "Non-Compete Period"), except with Buyer's prior
written consent, neither Seller nor Parent will, and will cause their respective
Subsidiaries not to, (directly or indirectly) own, manage, operate, control,
finance (other than in the ordinary course of business) or participate in the
ownership, management, operation, control or financing of (other than in the
ordinary course of business), or be connected with respect to the Competitive
Business as a principal, agent, representative, consultant, investor, owner,
partner, manager, joint venturer or otherwise with, or permit their name to be
used by or in connection with, any Competitive Business. "Competitive Business"
shall mean the processing, bottling, producing, distribution and sale of natural
spring water, mineral enriched water, flavored water or fluoridated water in PET
packages of 1 gallon or less to the retail consumer anywhere in the continent of
North America. Notwithstanding the foregoing, the Parties acknowledge and agree
that this Section 6.10(a) shall not apply to (i) any acquirer of the Parent,
Seller or their respective Subsidiaries which was immediately prior to such
acquisition engaged in the sale of natural spring water, mineral enriched water,
flavored water or fluoridated water to the retail consumer (in PET) packages of
1 gallon or less, or (ii) any
<PAGE>
sales of natural spring water, mineral enriched water, flavored water or
fluoridated water to the retail consumer solely in connection with the operation
by Parent, Seller or their respective Subsidiaries of their home and office
business.

            (b) Hiring of Seller's Employees. During the Non-compete Period,
Seller and Parent will not, and will cause their respective Subsidiaries not to,
(directly or indirectly) solicit for employment, or induce any other person to
hire or offer employment to any Transferred Employee who is then employed by
Buyer, nor will Seller induce any such employee to terminate his or her
employment with Buyer. In connection with the foregoing, Timothy G. Fallon shall
enter into the Side Letter Agreement with the Buyer in the form of Exhibit K.
Nothing contained in this Section 6.10(b) shall (i) prohibit the running of
general employment advertisements directed to the general population or to
specific industries other than the Competitive Business or hiring any employee
who responds to such an advertisement or (ii) be deemed to affect in any manner
any other provision of this Agreement.

            (c) Non-Solicitation of Clients or Customers. During the Non-Compete
Period, Seller and Parent will not, and will cause their Subsidiaries not to,
(directly or indirectly) solicit the business of, or conduct any business with,
any customer or client or prospective customer or client of the Buyer, for any
business purpose other than for the benefit of the Buyer or its subsidiaries or
affiliates with whom Seller and Parent have contact or dealings on behalf of the
Buyer; provided, that nothing contained herein shall prevent Seller, Parent or
their Subsidiaries from soliciting the business of, or conducting any business
with, any customer or client or prospective customer or client of the Buyer, for
any business purpose that is not a Competitive Business and that does not
otherwise interfere with the relationship, as it relates to the Business, of the
Buyer with such customer or client or prospective customer or client and
provided further that nothing contained herein shall prevent Seller, Parent or
their Subsidiaries from selling one (1) gallon or less PET packages in
connection with the operation of their home and office business. For purposes of
this Section, a "prospective customer or client" is any potential customer or
client that was, to the knowledge of Seller or Parent, actively solicited by the
Buyer within the 12 months preceding the solicitation of Seller or Parent
prohibited by this Section. During the Non-Compete Period, Seller and Parent may
not interfere or attempt to interfere with any transaction, prospective
agreement, business opportunity or business relationship involving the Buyer in
which Seller or Parent were involved or otherwise engage or participate in any
effort or act to induce any person to discontinue a relationship with the Buyer.

            (d) Buyer Non-Competition. During the Non-Compete Period, except
with the Seller's prior written consent, Buyer will not, and will cause its
Subsidiaries not to, (directly or indirectly) own, manage, operate, control,
finance (other than in the ordinary course of business) or participate in the
ownership, management, operation, control or financing of (other than in the
ordinary course of business), or be connected with respect to the Seller's
Competitive Business as a principal, agent, representative, consultant,
investor, owner, partner, manager, joint venture or otherwise with, or permit
its name to be used by or in connection with, any Seller Competitive Business.
"Seller Competitive Business" shall mean the processing, producing or bottling
of natural spring water, mineral enriched water, flavored water or fluoridated
water in three (3) or five (5) gallon containers anywhere in the State of
Vermont.

            (e) Hiring of Employees of Parent and Seller. During the Non-Compete
Period, Buyer will not, and will cause its respective Subsidiaries not to,
(directly or indirectly)
<PAGE>
solicit for employment, or induce any other person to hire or offer employment
to any employees of Parent or Seller other than those referred to in Section
6.9(a), nor will Buyer induce any such employee to terminate his or her
employment with Seller. Nothing contained in this Section 6.10(e) shall (i)
prohibit the running of general employment advertisements directed to the
general population or to the home and office business or hiring any employee who
responds to such an advertisement or (ii) be deemed to affect in any manner any
other provision of this Agreement.

            (f) Remedies for Breach. Each Party acknowledges that:

                  (i) The provisions of this Section 6.10 are reasonable and
necessary to protect the legitimate interests of the other Party, that any
violation of this Section 6.10 may result in irreparable injury to the other
Party and that damages at law would not be reasonable or adequate compensation
to the other Party for a violation of this Section 6.10; and

                  (ii) Each Party shall be entitled to have the provisions of
this Section 6.10 specifically enforced by preliminary and permanent injunctive
relief without the necessity of proving actual damages and without posting bond
or other security, as well as to have an equitable accounting of all earnings,
profits and other benefits arising out of any violation of this Section 6.10. If
the provisions of this Section 6.10 should ever be deemed to exceed the time,
geographic, product or other limitations permitted by applicable law, then such
provisions shall be deemed reformed to the maximum time, geographic, product or
other limitations permitted by law. If a violation of one or more of Sections
6.10(a), (b), (c), or (d) has occurred, the period specified in such section or
sections shall abate during the time of such violation and shall not continue
to- run until such violation has been cured.

6.11  [Intentionally Deleted]

6.12  Notices of Certain Events.

            (a) Notice of Certain Actions. The Seller, on the one hand, and the
Buyer on the other hand, shall promptly notify the other of:

                  (i) any notice or other written communication from any person
alleging that the consent of such person is or may be required in connection
with the transactions provided for in this Agreement;

                  (ii) any material notice or other communication from any
Governmental Authority in connection with the transactions provided for in this
Agreement; and

                  (iii) any action suit, claim, investigation or proceeding
commenced or, to its Knowledge, threatened against the Seller, on the one hand,
or the Buyer, on the other hand, which relates to the consummation of the
transactions provided for in this Agreement.

            (b) Notice of Breaches; Updates.

                  (i) The Seller shall promptly deliver to the Buyer written
notice of any event or development that would (A) render any representation or
warranty of the Seller
<PAGE>
contained in Article IV of this Agreement inaccurate or incomplete in any
material respect or (B) constitute or result in a breach by the Seller of, or a
failure by the Seller to comply with, in any material respect, any agreement or
covenant in this Agreement applicable to it. Any such disclosure, if not
objected to in writing by Buyer within the earlier of five (5) Business Days
after the effectiveness of such notice or immediately prior to the Closing,
shall be deemed to supplement such representation and warranty.

                  (ii) The Buyer shall promptly deliver to the Seller written
notice of any event or development that would (A) render any representation or
warranty of the Buyer in this Agreement inaccurate or incomplete in any material
respect or (B) constitute or result in a breach by the Buyer or a failure by the
Buyer to comply with, in any material respect, any agreement or covenant in this
Agreement applicable to it. Any such disclosure, if not objected to in writing
by Seller within the earlier of five (5) Business Days after the effectiveness
of such notice or immediately prior to the Closing, shall be deemed to
supplement such representation and warranty.

                                  ARTICLE VII

                                   CONDITIONS

7.1   Conditions to Obligations of Buyer.

      The obligations of Buyer to purchase the Purchased Assets and to
consummate the other transactions contemplated by this Agreement shall be
subject to the fulfillment or satisfaction at or prior to the Closing Date of
the following conditions:

            (a) No preliminary or permanent injunction or other order or decree
by any federal or state court which prevents the consummation of the sale of the
Purchased Assets contemplated herein shall have been issued and remain in effect
(each Party agreeing to cooperate in all Commercially Reasonable Efforts to have
any such injunction, order or decree lifted) and no statute, rule or regulation
shall have been enacted by any state or federal government or Governmental
Authority which prohibits the consummation of the sale of the Purchased Assets;

            (b) Buyer shall have received all of Buyer's Required Regulatory
Approvals, in form and substance reasonably satisfactory (including no material
adverse conditions) to it;

            (c) Seller and Parent shall have performed and complied in all
material respects with the covenants and agreements contained in this Agreement
which are required to be performed and complied with by Seller on or prior to
the Closing Date;

            (d) The representations and warranties of Seller and Parent set
forth in this Agreement shall be true and correct in all material respects as of
the Closing Date;

            (e) Buyer shall have received certificates on behalf of the Seller
from an authorized officer of Seller and Parent, dated the Closing Date, to the
effect that the conditions set forth in Sections 7.1(c) and (d) have been
satisfied by Seller;
<PAGE>
            (f) Buyer shall have received an opinion from Seller's counsel,
dated the Closing Date and reasonably satisfactory in form and substance to
Buyer and its counsel, in the form of Exhibit D attached hereto;

            (g) Seller or Parent shall have delivered, or caused to be
delivered, to Buyer at the Closing, Seller's closing deliveries described in
Section 3.6; and

            (h) Since the date of this Agreement, no Material Adverse Effect
shall have occurred.

7.2   Conditions to Obligations of Seller and Parent.

      The obligation of Seller and Parent to sell the Purchased Assets and to
consummate the other transactions contemplated by this Agreement shall be
subject to the fulfillment or satisfaction at or prior to the Closing Date of
the following conditions:

            (a) No preliminary or permanent injunction or other order or decree
by any federal or state court which prevents the consummation of the sale of the
Purchased Assets contemplated herein shall have been issued and remain in effect
(each Party agreeing to cooperate in all Commercially Reasonable Efforts to have
any such injunction, order or decree lifted) and no statute, rule or regulation
shall have been enacted by any state or federal government or Governmental
Authority which prohibits the consummation of the sale of the Purchased Assets;

            (b) Seller shall have received all of Seller's Required Regulatory
Approvals, in form and substance reasonably satisfactory (including no material
adverse conditions) to them;

            (c) All consents and approvals for the consummation of the sale of
the Purchased Assets described in Schedule 4.3(a) shall have been obtained or
waived;

            (d) Buyer shall have performed and complied with in all material
respects with the covenants and agreements contained in this Agreement which are
required to be performed and complied with by Buyer on or prior to the Closing
Date;

            (e) The representations and warranties of Buyer set forth in this
Agreement that are qualified by materiality shall be true and correct as of the
Closing Date and all other representations and warranties shall be true and
correct in all material respects as of the Closing Date, in each case as though
made at and as of the Closing Date;

            (f) Seller shall have received a certificate on behalf of Buyer from
an authorized officer of Buyer, dated the Closing Date, to the effect that the
conditions set forth in Sections 7.2(d) and (e) have been satisfied by Buyer;

            (g) Seller shall have received an opinion from Buyer's counsel,
dated the Closing Date, and reasonably satisfactory in form and substance to
Seller and its counsel, in the form of Exhibit E attached hereto; and

            (h) Buyer shall have delivered, or caused to be delivered, to Seller
at the Closing, Buyer's closing deliveries described in Section 3.7.
<PAGE>
                                  ARTICLE VIII

                                 INDEMNIFICATION

8.1   Indemnification.

            (a) Buyer shall indemnify, defend and hold harmless Parent, Seller,
any of their Affiliates and any of their respective officers, directors,
members, employees, shareholders, representatives and agents (each, a "Seller's
Indemnitee") from and against any and all claims, demands, suits, losses,
liabilities, damages, obligations, payments, costs and expenses (including,
without limitation, the costs and expenses of any and all actions, suits,
proceedings, assessments, judgments, settlements and compromises relating
thereto and reasonable attorneys' fees and reasonable disbursements in
connection therewith) (each, an "Indemnifiable Loss"), asserted against or
suffered by any Seller's Indemnitee relating to, resulting from or arising out
of (i) any breach by Buyer of any representations, warranties or covenants
contained in this Agreement, (ii) any breach or failure of Buyer to perform any
covenant or agreement made or contained in this Agreement or fulfill any
obligation with respect to such covenant or agreement, (iii) Buyer's failure to
pay or otherwise satisfy when due, the Assumed Liabilities and Obligations, (iv)
any Third Party Claims against a Seller's Indemnitee arising out of or in
connection with Buyer's ownership or operation of the Purchased Assets or the
Business after the Effective Time, or (v) the presence, disposal, transport, or
arrangement for transport after the Closing Date on, under or from the Real
Property or any other property occupied or operated by the Buyer of any
Hazardous Substances, and violation of, or noncompliance with, after the Closing
Date, any Environmental Permit or any Environmental Law.

            (b) Parent and Seller shall jointly and severally indemnify, defend
and hold harmless Buyer, its Affiliates and their respective officers,
directors, members, employees, shareholders, representatives and agents (each, a
"Buyer Indemnitee") from and against any and all Indemnifiable Losses asserted
against or suffered by any Buyer Indemnitee relating to, resulting from or
arising out of (i) any breach by Seller or Parent of any representations or
warranties contained in this Agreement, (ii) any breach or failure of Seller or
Parent to perform any covenant or agreement made or contained in this Agreement
or fulfill any obligation with respect to such covenant or agreement, (iii)
Seller's failure to pay or otherwise satisfy when due the Excluded Liabilities,
(iv) any Third Party Claims against a Buyer Indemnitee arising out of or in
connection with Seller's ownership or operation of the Purchased Assets or the
Business before the Effective Time, except to the extent such Third Party Claim
relates to any Assumed Liabilities and Obligations, (v) any Third Party Claims
against a Buyer Indemnitee arising out of or in connection with Seller's
ownership or operation of the Excluded Assets, or (vi) the presence, disposal,
transport, or arrangement for transport prior to the Closing Date on, under or
from the Real Property or any other property occupied or operated by the Seller
of any Hazardous Substances, and violation of, or noncompliance with, prior to
the Closing Date, any Environmental Permit or any Environmental Law.

            (c) Notwithstanding anything to the contrary contained herein, any
Person entitled to receive indemnification under this Agreement (an
"Indemnitee") shall use Commercially Reasonable Efforts to mitigate all losses,
damages and the like relating to a claim under these indemnification provisions,
including availing itself of any defenses, limitations, rights of contribution,
claims against third Persons and other rights at law or equity. The
<PAGE>
Indemnitee's Commercially Reasonable Efforts shall include the reasonable
expenditure of money to mitigate or otherwise reduce or eliminate any loss or
expenses for which indemnification would otherwise be due, and the Indemnitee
shall advise Indemnitor promptly of such expenditure (or provide Indemnitor with
the opportunity to pay such expenditures directly).

            (d) The expiration or termination of any representation, warranty or
covenant shall not affect the Parties' obligations under this Section 8.1 if the
Indemnitee provided the Person required to provide indemnification under this
Agreement (the "Indemnifying Party") with proper written notice of the claim or
event for which indemnification is sought prior to such expiration, termination
or extinguishment.

8.2   Defense of Claims.

            (a) If any Indemnitee receives notice of the assertion of any claim
or of the commencement of any suit, action, or proceeding made or brought by any
Person who is not a Party to this Agreement or any Affiliate of a Party to this
Agreement (a "Third Party Claim") with respect to which indemnification may be
sought from an Indemnifying Party, the Indemnitee shall give such Indemnifying
Party prompt written notice thereof, but in any event such notice shall not be
given later than twenty (20) calendar days after the Indemnitee's receipt of
notice of such Third Party Claim. Such notice shall describe the nature of the
Third Party Claim in reasonable detail and shall indicate the estimated amount
if practicable, of the Indemnifiable Loss that has been or may be sustained by
the Indemnitee. The Indemnifying Party will have the right to participate in or,
by giving written notice to the Indemnitee, to elect to assume the defense of
any Third Party Claim at such Indemnifying Party's expense and by such
Indemnifying Party's own counsel, provided that the counsel for the Indemnifying
Party who shall conduct the defense of such Third Party Claim shall be
reasonably satisfactory to the Indemnitee. The Indemnitee shall cooperate in
good faith in such defense.

            (b) (i) If within twenty (20) calendar days after an Indemnitee
provides written notice to the Indemnifying Party of any Third Party Claim, the
Indemnitee receives written notice from the Indemnifying Party that such
Indemnifying Party has elected to assume the defense of such Third Party Claim
as provided in Section 8.2 (a) , the Indemnifying Party will not be liable for
any legal or other expenses subsequently incurred by the Indemnitee in
connection with the defense thereof (except as provided in Section 8.3(c)(i));
provided, however, that if the Indemnifying Party shall fail to take reasonable
steps necessary to defend diligently such Third Party Claim within twenty (20)
calendar days after receiving notice from the Indemnitee that the Indemnitee
believes the Indemnifying Party has failed to take such steps, the Indemnitee
may assume its own defense and the Indemnifying Party shall be liable for all
reasonable expenses thereof.

                  (ii) Without the prior written consent of the Indemnitee, the
Indemnifying Party shall not enter into any settlement of any Third Party Claim
which would lead to liability or create any financial or other obligation on the
part of the Indemnitee for which the Indemnitee is not entitled to
indemnification hereunder. If a firm offer is made to settle a Third Party Claim
without leading to liability or the creation of a financial or other obligation
on the part of the Indemnitee for which the Indemnitee is not entitled to
indemnification hereunder and the Indemnifying Party desires to accept and agree
to such offer, the Indemnifying Party shall give written notice to the
Indemnitee to that effect. If the Indemnitee fails to consent to
<PAGE>
such firm offer within twenty (20) calendar days after its receipt of such
notice, the Indemnifying Party shall be relieved of its obligations to defend
such Third Party Claim and the Indemnitee may contest or defend such Third Party
Claim. In such event, the maximum liability of the Indemnifying Party as to such
Third Party Claim will be the amount of such settlement offer plus reasonable
costs and expenses paid or incurred by Indemnitee up to the date of said notice.

            (c) Any claim by an Indemnitee on account of an Indemnifiable Loss
which does not result from a Third Party Claim (a "Direct Claim") shall be
asserted by giving the Indemnifying Party prompt written notice thereof, but in
any event such notice shall not be given later than thirty (30) calendar days
after the Indemnitees notice of such Direct Claim. Such notice shall state the
nature of such claim in reasonable detail and indicating the estimated amount,
if practicable, and the Indemnifying Party shall have a period of thirty (30)
calendar days within which to respond to such Direct Claim. If the Indemnifying
Party does not respond within such thirty (30) calendar day period, the
Indemnitee will be free to seek enforcement of its right to indemnification
under this Agreement.

            (d) A failure to give timely notice as provided in this Section 8.2
shall not affect the rights or obligations of any Party hereunder except if, and
only to the extent that, as a result of such failure, the Party which was
entitled to receive such notice was actually prejudiced as a result of such
failure, including by the Indemnitee incurring an Indemnifiable Loss without the
Indemnifying Party's consent or knowledge.

8.3   Limits on Indemnification.

            (a) Seller and Parent shall not have any obligation to indemnify the
Buyer Indemnitees for claims under Section 8.l (b)(i) and 8.1(b)(ii) until the
Indemnifiable Losses of the Buyer Indemnitees with respect to such claims shall
exceed $125,000 in the aggregate (the "Threshold"), whereupon the total amount
of such Indemnifiable Losses from the first dollar and without regard to the
Threshold shall be recoverable by the Buyer Indemnities in accordance with the
terms hereof.

            (b) In no event shall the total obligations of Seller under the
indemnification provided in Sections 8.1(b)(i) and 8.1(b)(ii) exceed $5,000,000,
except in the event of fraud or intentional misrepresentation by the Seller or
Parent.

            (c) Notwithstanding anything to the contrary contained herein, any
Indemnifiable Loss shall be net of (i) the dollar amount of any insurance or
other proceeds actually received by the Indemnitee or any of its Affiliates with
respect to the Indemnifiable Loss and (ii) income Tax benefits to the Indemnitee
or any of its Affiliates with respect to the Indemnifiable Loss, but such net
amount shall be increased to give effect to the Income Taxes payable as a result
of the receipt of any indemnification payments hereunder so that the Indemnitee
is held harmless after Tax. Any Party seeking indemnity hereunder shall use its
best efforts to make claims (including both costs of defense and indemnity)
under applicable insurance policies with respect to any such Indemnifiable Loss.
If after any payment of indemnity with respect to an Indemnifiable Loss is made
hereunder by an Indemnifying Party, any insurance proceeds, tax benefit or
recovery, settlement or payment by, from or against any other entity is received
by the Indemnified Party or any Affiliate with respect to such
<PAGE>
Indemnifiable Loss, then the Indemnified Party shall, or shall cause such
Affiliate to, remit to the Indemnifying Party the lesser of (i) the amount of
the insurance proceeds, tax benefit or other recovery, settlement or payment, if
not previously taken into account in computing the indemnity payment with
respect to such Indemnifiable Loss, and (ii) any amounts previously paid by the
Indemnifying Party pursuant to Article VIII with respect to such Indemnifiable
Loss.

            (d) The sole recourse and exclusive remedy of either Party after the
Closing Date for the breach of this Agreement shall be to assert a claim for
indemnification under this Article VIII or to recover such amounts as are
otherwise due pursuant to the terms of this Agreement, except for claims based
on fraudulent actions, misrepresentations or breaches.

            (e) If (i) Parent or Seller agree in writing or (ii) pursuant to a
final order of a court, not subject to further appeal, Parent or Seller is
legally required, to indemnify Buyer pursuant to this Article VIII, the amount
of such indemnification shall be paid first as a prepayment under the Promissory
Note and then to the extent there still exists any deficiency thereafter by
Seller or Parent paying such amount in cash.

8.4   No Third Party Beneficiary.

      The parties hereto acknowledge and agree that the provisions of this
Article VIII are solely for the benefit of the Indemnified Parties and are not
intended, and shall not create, any third-party beneficiary rights in any other
person or entity.

                                   ARTICLE IX

                                   TERMINATION

9.1   Termination.

            (a) This Agreement may be terminated at any time prior to the
Closing Date by mutual written consent of Seller and Buyer.

            (b) This Agreement may be terminated by Seller or Buyer, if:

                  (i) any Federal or state court of competent jurisdiction shall
have issued an order, judgment or decree permanently restraining, enjoining or
otherwise prohibiting the Closing, and such order, judgment or decree shall have
become final and nonappealable; or

                  (ii) the Closing contemplated hereby shall have not occurred
on or before March 31, 2004 (the "Termination Date") unless extended by mutual
agreement of the parties in writing, provided that the right to terminate this
Agreement under this Section 9.1(b) (ii) shall not be available to any Party
whose failure to fulfill any obligation under this Agreement has been the cause
of, or resulted in, the failure of the Closing to occur on or before such date.

            (c) This Agreement may be terminated by Buyer if any of Buyer's
Required Regulatory Approvals, the receipt of which is a condition to the
obligation of Buyer to consummate the Closing as set forth in Section 7.1(b),
shall have not been obtained or been
<PAGE>
denied (and a petition for rehearing or refiling of an application initially
denied without prejudice shall also have been denied) or shall have been granted
but are not in form and substance reasonably satisfactory to Buyer because such
Approval contains conditions that would have a Material Adverse Effect or a
Material Adverse Effect on the business, assets, operations or condition
(financial or otherwise) of Buyer.

            (d) This Agreement may be terminated by Seller, if any of the
consents and approvals described in Schedule 4.3(a) or if any of Seller's
Required Regulatory Approvals, the receipt of which is a condition to the
obligation of Seller to consummate the Closing as set forth in Section 7.2(b)
and Section 7.2(c), respectively, shall not been obtained or have been denied
(and a petition for rehearing or refiling of an application initially denied
without prejudice shall also have been denied) or shall have been granted but
are not in form and substance reasonably satisfactory to Seller, because such
consent or Approval contains conditions that would have a material adverse
effect on the business, assets, operations or condition (financial or otherwise)
of Seller.

            (e) This Agreement may be terminated prior to Closing by Buyer if
there has been a material violation or breach by Seller or Parent of any
covenant, representation or warranty contained in this Agreement and such
violation or breach is not cured by the earlier of the Closing Date or the date
ten (10) days after receipt by Seller of notice specifying particularly such
violation or breach, and such violation or breach has not been waived by Buyer.

            (f) This Agreement may be terminated prior to Closing by Seller if
there has been a material violation or breach by Buyer of any covenant,
representation or warranty contained in this Agreement and such violation or
breach is not cured by the earlier of the Closing Date or the date ten (10) days
after receipt by Buyer of notice specifying particularly such violation or
breach, and such violation or breach has not been waived by Seller.

9.2   Procedure and Effect of No-Default Termination.

      In the event of termination of this Agreement by either or both of the
Parties pursuant to Section 9.1, written notice thereof shall forthwith be given
by the terminating Party to the other Party, whereupon, if this Agreement is
terminated pursuant to any of Sections 9.1(a) through (f), the liabilities of
the Parties hereunder will terminate, except as otherwise expressly provided in
this Agreement, and thereafter neither Party shall have any recourse against the
other by reason of this Agreement.

                                   ARTICLE X

                            MISCELLANEOUS PROVISIONS

10.1  Amendment and Modification.

      Except as otherwise provided herein, this Agreement may not be amended,
modified or supplemented except by a written agreement executed by Parent,
Seller and Buyer.

10.2  Waiver of Compliance: Consents.
<PAGE>
      Except as otherwise provided in this Agreement, any failure of any of the
Parties to comply with any obligation, covenant, agreement or condition herein
may be waived by the Party entitled to the benefits thereof by a written
instrument signed by the Party granting such waiver (except that the occurrence
of the Closing shall be deemed to waive the fulfillment or satisfaction of any
conditions to consummate the transactions contemplated by this Agreement), but
such waiver of such obligation, covenant, agreement or condition shall not
operate as a waiver of, or estoppel with respect to, any subsequent failure to
comply therewith.

10.3  Survival of Representations. Warranties. Covenants and Obligations.

            (a) The representations and warranties given or made by any Party in
this Agreement or in any certificate furnished pursuant hereto shall survive the
Closing for a period of one (1) year after the Closing Date and shall thereafter
terminate and be of no further force or effect, except that (a) all
representations and warranties contained in Sections 4.7, 4.12 and 4.21 shall
survive the Closing for the period of the applicable statutes of limitation; (b)
the representation and warranty contained in Section 4.23 shall survive the
Closing for a period of three (3) years; and (c) any representation or warranty
as to which a claim (including without limitation a contingent claim) shall have
been asserted prior to the expiration of such representation or warranty shall
continue in effect with respect to such claim until such claim shall have been
finally resolved or settled.

            (b) The covenants and obligations of Seller and Buyer set forth in
this Agreement, including without limitation the indemnification obligations of
the parties under Article VIII hereof, shall survive the Closing indefinitely,
and the Parties shall be entitled to the full performance thereof by the other
Parties hereto without limitation as to time or amount (except as otherwise
specifically set forth herein); provided that the obligations of Seller under
Section 8.1(b)(vi) shall at the end of the applicable statute of limitation
period, so that Seller shall have no further responsibility for indemnification
with respect to environmental matters after such period, and provided further
that the indemnification obligation of the parties related to breaches of
representations and warranties shall, with respect to each representation and
warranty, terminate upon the termination of the applicable survival period of
such representation and warranty set forth in Section 10.3(a) hereof, it being
understood that the indemnification obligations of the parties with respect to
any representation or warranty as to which a claim (including without
limitation, a contingent claim) shall have been asserted prior to the expiration
of such representation or warranty shall continue in effect with respect to such
claim until such claim shall have been finally resolved or settled.

10.4  Notices.

      All notices and other communications hereunder shall be in writing and
shall be effective (i) when delivered, if delivered by hand or by facsimile
transmission (with confirmation of receipt), (ii) the next business day, if sent
by nationally recognized overnight delivery specifying next day delivery, or
(iii) three (3) business days after depositing in the United States mails, if
sent by certified mail, postage prepaid, addressed to a Party's address set
forth below (or at such other address or facsimile number for a Party as shall
be specified by like notice; provided however, that notices of a change of
address shall be effective only upon receipt thereof):
<PAGE>
             (a)   If to Parent or Seller, to:

                            Vermont Pure Holdings, Ltd.
                            1050 Buckingham Street
                            Watertown, CT 06795-1600
                            Attention: Timothy G. Fallon,
                            Chairman and Chief Executive Officer
                            Facsimile: (860) 945-0661

                   with a copy to:

                            Cozen O'Connor
                            1900 Market Street
                            Philadelphia, PA 19103
                            Attention: Kevin F. Berry, Esq.
                            Facsimile: (215) 665-2013

             (b)   if to Buyer, to:

                            MicroPack Corporation
                            5 Commonwealth Road
                            Suite 3A
                            Natick, MA 01760
                            Attention: James M. Morgan,
                            President and Chief Executive Officer
                            Facsimile: (508) 647-1092

                   with a copy to:

                            Mintz, Levin, Cohen, Ferris, Glovsky and Popeo, P.C.
                            One Financial Center
                            Boston, MA 02111
                            Attention: Mary-Laura Greely, Esquire
                            Facsimile: (617) 542-6000

10.5  Assignment.

      This Agreement and all of the provisions hereof shall be binding upon and
inure to the benefit of the Parties hereto and their respective successors and
permitted assigns, but neither this Agreement nor any of the rights, interests
or obligations hereunder shall be assigned by any Party hereto, including by
operation of law, without the prior written consent of each other Party, such
consent not to be unreasonably withheld after the Effective Date, nor is this
Agreement intended to confer upon any other Person except the Parties hereto any
rights, interests, obligations or remedies hereunder. No provision of this
Agreement shall create any third party beneficiary rights in any employee or
former employee of Seller (including any beneficiary or dependent thereof) in
respect of continued employment or resumed employment, and no provision of this
Agreement shall create any rights in any such Persons in respect of any benefits
<PAGE>
that may be provided, directly or indirectly, under any employee benefit plan or
arrangement except as expressly provided for thereunder. Notwithstanding the
foregoing, Buyer may assign its rights, interests and obligations hereunder at
any time to an Affiliate, Subsidiary or to its then existing senior lender,
provided that no such assignment shall relieve Buyer from its obligations
hereunder. Any attempted assignment in violation of this Section 10.5 shall be
null and void and of no effect.

10.6  Governing Law.

      This Agreement shall be governed by and construed in accordance with the
law of the State of Delaware (without giving effect to any choice or conflict of
law principles) as to all matters, including but not limited to matters of
validity, construction, effect, performance and remedies. THE PARTIES HERETO
AGREE THAT VENUE IN ANY AND ALL ACTIONS AND PROCEEDINGS RELATED TO THE SUBJECT
MATTER OF THIS AGREEMENT SHALL BE IN THE STATE AND FEDERAL COURTS IN THE STATE
OF DELAWARE, WHICH COURTS SHALL HAVE EXCLUSIVE JURISDICTION FOR SUCH PURPOSE,
AND THE PARTIES HERETO IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF SUCH
COURTS AND IRREVOCABLY WAIVE THE DEFENSE OF AN INCONVENIENT FORUM TO THE
MAINTENANCE OF ANY SUCH ACTION OR PROCEEDING. SERVICE OF PROCESS MAY BE MADE IN
ANY MANNER RECOGNIZED BY SUCH COURTS. EACH OF THE PARTIES HERETO IRREVOCABLY
WAIVES ITS RIGHT TO A JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT
OF ANY DISPUTE IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.

10.7  Counterparts.

      This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.

10.8  Severability.

      Any provision of this Agreement that is invalid or unenforceable in any
jurisdiction shall be ineffective to the extent of such invalidity or
unenforceability without invalidating or rendering unenforceable the remaining
provisions hereof, and any such invalidity or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

10.9  Interpretation.

      The article and section headings contained in this Agreement are solely
for the purpose of reference, are not part of the agreement of the Parties and
shall not in any way affect the meaning or interpretation of this Agreement.

10.10 Disclosure Letters and Exhibits.

      Except as otherwise provided in this Agreement, all Exhibits and the
Disclosure Letters referred to herein are intended to be and hereby are
specifically made a part of this Agreement.
<PAGE>
Any item disclosed in a Schedule to a Disclosure Letter in response to one
Section of this Agreement shall be deemed disclosed in response to any other
Section hereof only if the item disclosed in the Schedule not referred to
specifically cross references the representation and warranty to be qualified by
such item or the relevance of any item in any such Schedule to such
representation and warranty is reasonably apparent on its face.

10.11 Entire Agreement.

      This Agreement, the Disclosure Letters, the Assignment and Assumption
Agreement, the Bill of Sale, the Supply Agreement, the Vermont Pure License
Agreement, the Occupancy Agreement, the Pristine Agreement, the Packaging
Agreement, the Side Letter Agreement, the Hidden Spring License Agreement, the
Promissory Note and the Trademark Assignment embody the entire agreement and
understanding of the Parties hereto with respect to the transactions
contemplated by this Agreement.

10.12 Bulk Sales Laws.

      Buyer acknowledges that, notwithstanding anything in this Agreement to the
contrary, Seller will not comply with the provision of the bulk sales laws of
any jurisdiction in connection with the transactions contemplated by this
Agreement to the extent they are applicable. Buyer hereby waives compliance by
Seller with the provisions of such bulk sales laws; provided, however, that
Seller shall fully and promptly indemnify, defend and hold Buyer harmless for
any liability resulting for such failure, except to the extent that such
liability has been expressly assumed by Buyer pursuant to this Agreement.

                  [REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
<PAGE>
      IN WITNESS WHEREOF, Parent, Seller and Buyer have caused this Agreement to
be signed by their respective duly authorized officers as of the date first
above written.

                                          VERMONT PURE SPRINGS, INC.

                                          By:/s/ Timothy G. Fallon
                                             ----------------------------------
                                          Name:  Timothy G. Fallon
                                          Title: Chief Executive Officer

                                          VERMONT PURE HOLDINGS, LTD.

                                          By:/s/ Timothy G. Fallon
                                             ----------------------------------
                                          Name:  Timothy G. Fallon
                                          Title: Chief Executive Officer

                                          MICROPACK CORPORATION

                                          By:/s/ James M. Morgan
                                             ----------------------------------
                                          Name:  James M. Morgan
                                          Title: President/CEO

                 [Signature Page to Purchase and Sale Agreement]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00063-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00063-of-00352.parquet"}]]