Document:

Exhibit 10.1 Licensing with Mariz and WNG

AMENDING
AGREEMENT

 

THIS
AGREEMENT IS MADE THE
1ST DAY OF APRIL, 2005

 

	
      BETWEEN:

       
	
      MARIZ
      GESTAO E INVESTIMENTOS LIMITADA, a corporation
      duly incorporated in accordance with the laws of Madeira,
      herein acting
      and represented by Rodney Hodges, one of its Directors,

       

      (the
      "Licensor”) 

       

	 	
      PARTY
      OF THE FIRST PART

       

	
      AND:

       
	
      WEIDER
      NUTRITION GROUP, INC., a
      corporation duly incorporated in accordance with the laws of the State of
      Utah, herein acting and represented by Joseph W. Baty, its Chief Financial
      Officer,

       

      (the
      “Licensee”)

       

	 	
      PARTY
      OF THE SECOND PART

       

 

1.  PREAMBLE

 

1.1  WHEREAS Licensor and
Licensee have entered into a License Agreement dated as of December 1, 1996 with
respect to certain trade-marks, a copy of which is annexed hereto as Exhibit 1
(the “Original
License Agreement”);

 

1.2  WHEREAS the Original
License Agreement was supplemented by: (a) a letter dated as of December 1, 1996
from Licensee to Licensor, a copy of which is annexed hereto as Exhibit 2,
confirming that certain trade-marks were included within the ambit of the
Original License Agreement (the “Original
Supplemental Letter”); and (b) two
letters annexed hereto as Exhibit 3 (the “Subsequent
Supplemental Letters”), whereby
Licensee agreed to amend the Original License Agreement for the purpose of
excepting from the exclusive nature of its license under the License Agreement
the sale by Morinaga & Co. Ltd. of “In Products” in Taiwan, Korea, China,
Singapore, Hong Kong, Malaysia, Indonesia, the Philippines and Thailand in
association with the trademark “Weider” and “Weider”-formative trademarks
(collectively, the "Extended
Territory");

 

1.3  WHEREAS Licensee and
Weider Global Nutrition, LLC (“WGN”) have entered
into that certain Asset Purchase Agreement made as of the 1st day of April, 2005
(the "Purchase
Agreement"), pursuant to
which Licensee agreed, inter
alia, to sell, assign
and transfer to WGN those of Licensee’s assets, rights and properties necessary
for the conduct of its business referred to herein as the “Weider Branded
Business” including, without limitation, Licensee’s rights to use the trade-mark
“Weider”, all “Weider”-formative trade-marks and such other trademarks as are
more specifically set forth in Exhibit 5 annexed hereto to form an integral part
hereof (collectively, the “Weider
Trademarks”), as well as all
corresponding rights, title and interest of Licensee in and to the Original
License Agreement, the Original Supplemental Letter and the Subsequent
Supplemental Letters (collectively, the “License
Agreement”) solely with
respect to the Weider Trademarks (collectively, the “Partial
Assignment”);
and

 

1.4  WHEREAS Licensee has
requested Licensor’s consent to the Partial Assignment of Licensee’s rights,
title and interest in and to the License Agreement solely with respect to the
Weider Trademarks;

 

 

  - 2
-

 

1.5  WHEREAS the Partial
Assignment of Licensee’s rights, title and interest in and to the License
Agreement solely with respect to the Weider Trademarks will require that certain
amendments be made to the License Agreement in order to reflect the fact that
Licensee will retain its rights, title and interest in and to the License
Agreement with respect to all trademarks licensed thereunder other than the
Weider Trademarks; and

 

1.6  WHEREAS Licensor is
prepared to grant its consent to the Partial Assignment, and to agree with
Licensee as to certain amendments to the License Agreement, the whole upon the
terms and conditions set forth in this Amending Agreement.

 

    NOW,
THEREFORE, in consideration
of the mutual covenants contained herein and in the License Agreement and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby expressly acknowledged, the parties hereby agree as follows:

 

2.  DEFINITIONS

 

2.1  Each capitalized
term used but not defined herein has the meaning ascribed to it in the License
Agreement.

 

2.2  Whenever used in
this Amending Agreement, the term “Effective
Date” means March 1,
2005. 

 

3.  CONDITIONS

 

3.1  The parties agree
that, notwithstanding the date of execution of this Amending Agreement, this
Amending Agreement shall only become effective on the Effective Date and is
conditional upon: (i) the closing of the transaction of purchase and sale
contemplated by the Purchase Agreement; and (ii) the execution by Licensor and
WGN of a mutually satisfactory license agreement with respect to the Weider
Trademarks.

 

4.  AMENDMENTS
TO THE LICENSE AGREEMENT

 

	4.1   	The parties
      hereby amend the License Agreement as
follows:

 

	4.1.1   	paragraph A
      of the preamble to the Original License Agreement is hereby amended by
      deleting and replacing: (i) the words “exclusive licensee” by the words
      “the owner”; and (ii) the words “with respect to the Trademarks” by the
      words “of the registrations, and applications for registration, of the
      Trademarks”,

 

	4.1.2    	
      paragraph B
      of the preamble to the Original License Agreement is hereby amended by
      deleting and replacing the word “sublicense” by the word
      “license”;

 

	4.1.3    	
      the
      definition of “Royalties” in Section 1 of the Original License Agreement
      is hereby amended by deleting and replacing the words “Clause 3.1(c)” by
      the words “Clause 3.1(a)”;

 

	4.1.4    	
      the
      definition of “Royalty Year” in Section 1 of the Original License
      Agreement is hereby amended by deleting and replacing the words “June 1,
      1999” by the words “March 1, 2005”;

 

	4.1.5   	
      the
      definition of “Trademarks” in Section 1 of the Original License Agreement
      is hereby deleted in its entirety and replaced by the
      following:

 

““Trademarks” shall
mean the trademarks as listed in Schedule 1, other than the Weider
Trademarks.”

 

- 3
-

 

 

	4.1.6   	
      Section 1 of
      the Original License Agreement is amended by including a new definition as
      follows:

 

“Weider Trademarks”
shall mean the trademark “Weider”, all “Weider”-formative trademarks and such
other trademarks as are more specifically set forth in Schedule 4.”

 

	4.1.7    	
      Section 2.1
      of the Original License Agreement is hereby amended by replacing the word
      “sublicense” by the word “license”;

 

	4.1.8    	
      the parties
      acknowledge that, by reason of Licensor’s efforts, the rights of persons
      or entities entitled to use the Trademarks in the countries of Australia,
      New Zealand and South Africa has been terminated and such Trademarks have
      ceased to be Unavailable Trademarks. However, notwithstanding Licensor’s
      best efforts, Licensor has been unable to recover the rights of persons or
      entities to the Unavailable Trademarks in Japan. Accordingly, the parties
      agree that Section 2.4 of the Original License Agreement is hereby deleted
      and replaced by the following:

 

“2.4 Licensee agrees
that (i) as a result of a pre-existing license agreement, Licensor does not have
the rights to license the Trademarks to Licensee in Japan (the “Japan Rights”),
(ii) Japan is not included in the definition of Territory and Licensee shall not
be entitled to use the Trademarks in Japan, unless and until Licensor obtains
the Japan Rights and (iii) Licensor is under no obligation to perform any act or
incur any of the costs or expenses in connection with, or otherwise pursue, the
acquisition of the Japan Rights. Licensor agrees that it will provide prompt
written notice to Licensee if, as and when Licensor obtains the Japan
Rights.”;

 

	4.1.9     	
      Sections
      3.1(a) and 3.1(b) the Original License Agreement are hereby
      deleted;

 

	4.1.10    	
      Section
      3.1(c) of the Original License Agreement is hereby amended as
      follows:

 

(a)  by deleting the
first paragraph thereof and replacing it by the following
paragraph:

 

“3.1(a) For each
Royalty Year commencing March 1, 2005, Royalties shall be paid as
follows:”

 

(b)  by deleting the
words “$33 million” in paragraph (i) of Section 3.1(c) and replacing them by the
words “$ 7 million U.S.”,

 

(c)  by deleting the
words “$33 million” and “$66 million” in paragraph (ii) of Section 3.1(c) and
replacing them by the words $7 

million U.S.” and
“$14 million U.S.”, respectively, 

 

(d)  by deleting the
words “$66 million” and “$100 million” in paragraph (iii) of Section 3.1(c) and
replacing them by the words “$14

 million U.S.”
and “$21 million U.S.”, respectively, and

 

(e)  by deleting the
words “$100 million” in paragraph (iv) of Section 3.1(c) and replacing them by
the words “$21 million U.S.”;

 

	4.1.11    	
      Section 3.2
      is hereby deleted.

 

 

- 4 -

 

 

	4.1.12    	
      Section 3.3
      of the Original License Agreement is hereby deleted and replaced as
      follows:

 

“3.3 In connection
with Royalties owing pursuant to Clause 3.1(a), the Licensee shall, for the
first Royalty Year, pay to the Licensor a monthly Royalty equal to seven
thousand five hundred U.S. dollars ($7,500 U.S.). Thereafter Licensee shall pay
to Licensor a monthly Royalty equal to the greater of seven thousand five
hundred U.S. dollars ($7,500 U.S.) or one twelfth (1/12) of the previous year’s
Royalty paid by Licensee to Licensor. The monthly Royalty shall be paid no later
than the first day of each month as and from March 1, 2005.”

 

	4.1.13    	
      Section
      3.4(a) of the Original License Agreement is hereby deleted and replaced as
      follows:

 

“3.4(a) Within ninety (90)
days following the end of each Royalty Year commencing March 1, 2005, to the
extent that the amounts theretofore paid by Licensee to the Licensor under
Clause 3.3 is less than the Royalties otherwise due and owing by the Licensee to
the Licensor (pursuant to Clause 3.1(a) above), the difference shall be paid by
the Licensee to the Licensor.”

 

For greater
certainty, Section 3.4(a) of the Original License Agreement remains in effect
until February 28, 2005, such that Licensee shall pay to Licensor, by June 1,
2005, the amount by which: (i) the Royalties due and owing by the Licensee to
the Licensor pursuant to Clause 3.1(c) of the Original License Agreement (prior
to this Amending Agreement entering into effect), exceeds (ii) the amounts paid
by Licensee to the Licensor under Clause 3.3 of the Original License Agreement
(prior to this Amending Agreement entering into effect) in respect of the period
from June 1, 2004 to February 28, 2005;

 

	4.1.14    	
      Section
      3.4(b) of the Original License Agreement is hereby amended by deleting and
      replacing:

 

(a)  the words “Clause
3.1(c)” by the words “Clause 3.1(a)”

 

(b)  the words “Partial
Royalty Year or any Royalty Year, as the case may be,” by “Royalty Year” in line
4,

 

(c)  the words “Partial
Royalty Year, or Royalty Year as the case may be,” by “Royalty Year” in line
7,

 

	4.1.15    	
      Section 4 of
      the Original License Agreement is hereby amended by deleting and
      replacing:

 

(a)  the words “May 31,
2002” by the words “February 28, 2009 (the “Initial Term”)”; and

 

(b)  the words “June 1,
2002” by the words “March 1, 2009”;

 

	4.1.16    	
      Section 6.7
      of the Original License Agreement is hereby amended by deleting and
      replacing the words “name Weider” by the word
  “Trademarks”;

 

	4.1.17    	
      Section
      10.1.1 of the Original License Agreement is hereby deleted and replaced as
      follows:

 

 

- 5 -

 

 

“Failure on the
part of Licensee to: (i) make any payment due to Licensor under this Agreement
for 15 days after such payment shall have become due; and (ii) cure such breach
within 15 days after written notice from Licensor advising Licensee of the
occurrence of the event set forth in paragraph (i) of this Section
10.1.1.”

 

	4.1.18    	
      Section 10.2
      of the Original License Agreement is hereby amended by inserting the
      following words at the end of said Section 10.2: “or upon the occurrence
      of all of the events contemplated by Section 14.8
  hereof.”;

 

	4.1.19    	
      Section 14.6
      of the Original License Agreement is hereby amended
by:

 

(a)  deleting and
replacing its current title by the following:

 

“Option and
Forced Sale of Trademarks”

 

(b)  adding a title to
the existing paragraph in Section 14.6 as follows:

 

“14.6.1 Irrevocable
Option”

 

(c)  deleting and
replacing:

 

(i) the words “May 31,
2002” in the 3rd line of the existing paragraph in Section 14.6 by the words
“February 28, 2009”, and

 

(ii) the words
“$7,000,000 U.S.” in the 4th line of the existing paragraph in Section 14.6 by
the words “$2,000,000 U.S.”, and

 

(d)  inserting a new
paragraph 14.6.2 as follows:

 

“14.6.2 Drag Along with
the Sale of Schiff brand in the U.S.

 

If, during the
Initial Term, (i) Licensee enters into a definitive agreement with an
unaffiliated third party (“Buyer”) to sell all or substantially all of
Licensee’s rights, title and interest in and to the trademark “Schiff” (the
“Transaction”), and (ii) the Transaction is actually consummated (the
“Closing”), then, at the time of the Closing, Licensee shall cause the Buyer,
whether by itself or through Licensee, to purchase at the Closing all of
Licensor’s rights, title and interest in and to the Trademarks for a purchase
price equal to $2,000,000 U.S. Licensee shall be required to provide reasonable
advance written notice to Licensor of a Transaction, provided that such written
notice shall be no later than 30 days prior to the Closing. 

 

	4.1.20    	
      Schedule1 of
      the Original License Agreement is hereby deleted and replaced by a new
      Schedule 1 in the form attached as Exhibit 4 to this Amending
      Agreement;

 

	4.1.21    	
      the text of
      Schedule 3 of the Original License Agreement is hereby deleted and
      replaced by the following:

 

“Territories

 

All countries of
the world except Canada, the United States (and its possessions), Mexico, Spain,
Portugal and, subject to Clause 2.4, Japan.”

 

	4.1.22    	
      A new
      Schedule 4 is inserted in the Original License Agreement, in the form
      attached as Exhibit 5 to this Amending
Agreement.

 

 

- 6 -

 

 

5.     CONSENT

 

5.1  In consideration of
the Licensee’s covenants under this Amending Agreement, the Licensor hereby
consents to the Partial Assignment by Licensee to WGN of Licensee’s rights,
title and interest in and to the License Agreement solely with respect to the
Weider Trademarks, as and from the Effective Date.

 

6.  FURTHER
ACTIONS 

 

6.1  Each of the parties
hereby covenants and agrees, at its sole cost and expense, to execute and
deliver, at the request of the other party, such further instruments of transfer
and assignment and to take such other action as such other party may reasonably
request to more effectively give effect to this Amending Agreement.

 

7.  GENERAL
PROVISIONS

 

7.1  The preamble hereof
shall form an integral part of this Amending Agreement. 

 

7.2  Each provision of
the License Agreement not expressly amended by this Amending Agreement remains
in full force and effect and is hereby ratified and confirmed by the parties,
and the parties further confirm that the Original License Agreement, the
Original Supplemental Letter, the Subsequent Supplemental Letter and this
Amending Agreement shall be construed as, and constitute, one
agreement.

 

7.3  This Amending
Agreement shall be governed by and interpreted and enforced in accordance with
the laws of England (excluding any conflict of laws rule or principle which
might refer such interpretation to the laws of another
jurisdiction).

 

7.4  The division of
this Amending Agreement into sections and the insertion of headings are for
convenience of reference of this Amending Agreement. The headings in this
Amending Agreement are not are not intended to be full or precise descriptions
of the text to which they refer and are not to be considered part of this
Amending Agreement. All uses of the words “hereto”, “herein”, "hereof", "hereby"
and "hereunder" and similar expressions refer to this Amending Agreement as a
whole, unless otherwise specifically stated in this Amending
Agreement.

 

7.5  Any notice, demand
or request required or permitted to be given hereunder shall be in writing and
shall be deemed effective one (1) business day after having been faxed or six
(6) business days after been mailed by prepaid, registered or certified mail,
return receipt requested, to the addressee as follows: (i) if to Licensor, to
the attention of Mr. Rodney Hodges at P.O. Box 148, Union House, Union Street,
St. Helier Jersey, Channel Islands, JE4 8QL, or at the following fax number: +44
1534 504 701, with a copy to the attention of Mr. Bruno Floriani of Lapointe
Rosenstein, attorneys, at 1250 René-Lévesque Blvd. W., Suite 1400, Montreal,
Quebec, Canada, H3B 5E9 or at the following fax number: (514) 925-5010; or (ii)
if to Licensee, to the attention of the Chief Financial Officer at the address
of Licensee set forth above or at the following fax number: (801) 975-1924. Any
party may change its address or fax number for the purposes of this Amending
Agreement by giving written notice thereof to the other parties in accordance
with this provision.

 

7.6  The Original
License Agreement, the Original Supplemental Letter, the Subsequent Supplemental
Letter and this Amending Agreement set forth the entire agreement and
understanding between the parties with respect to the subject matter hereof and
supersedes all prior discussions, negotiations and agreements, verbal or
written, relating to the subject matter hereof. Neither party shall be bound by
any conditions, definitions, representations or warranties with respect to the
subject matter hereof other than those contained herein or hereafter set forth
in a writing duly executed by the parties.

 

 

- 7 -

 

 

7.7  Neither party shall
be entitled to assign, transfer or otherwise encumber any of its rights or
obligations hereunder, or subcontract the performance of any of its obligations,
or without the prior written consent of the other party. Subject to the
foregoing, this Amending Agreement shall be binding upon and enure to the
benefit of the parties hereto and their respective successors and permitted
assigns. Notwithstanding the foregoing, each party (the “Assigning
Party”) shall be
entitled to assign and transfer all of its rights, title and interest in and to
this Amending Agreement and the License Agreement, without the other party’s
prior written consent but after giving written notice to the other party, to (i)
any Affiliate of the Assigning Party; or (ii) any corporation, partnership,
trust, settlement or other entity resulting from a bone
fide reorganization of
the Assigning Party; provided in each case that the assignee agrees to be bound
by the terms hereof and that the Assigning Party remains jointly and severally
bound hereunder and under the License Agreement with the assignee. As used in
this Amending Agreement, “Affiliate” shall mean, with
regard to either party, any corporation, partnership, trust, settlement or other
entity that directly or indirectly controls, is control by, or is under common
control with such party. “Control” of an entity
shall mean possession, directly or indirectly, of power to direct or cause the
direction of management of policies of such entity, whether by ownership of
voting securities, by contract or otherwise. 

 

7.8  This Amending
Agreement may be executed in several counterparts, by facsimile or otherwise,
each of which when so executed shall be deemed to be an original, and together
shall constitute one and the same document.

 

[SIGNATURE
PAGE FOLLOWS]

- 8 -

 

 

 

IN WITNESS
WHEREOF, the parties have
executed this Amending Agreement as of the date first hereinabove
mentioned.

 

	
       

      WEIDER
      NUTRITIION GROUP, INC.

       

	
      Per :
	 	 
	 	
      Joseph W.
      Baty, Chief Financial Officer

       

	
      MARIZ
      GESTAO E INVESTIMENTOS LIMITADA

       

	
      Per :
	 	 
	 	
      Rodney
      Hodges, Director
	 

 

 

 

 

 

EXHIBIT
1

 

 

ORIGINAL
LICENSE AGREEMENT

 

 

 

 

EXHIBIT
2

 

 

ORIGINAL
SUPPLEMENTAL LETTER

 

 

 

 

 

EXHIBIT
3

 

 

SUBSEQUENT
SUPPLEMENTAL LETTERS

 

 

 

 

 

EXHIBIT
4

 

 

 

SCHEDULE
1

 

 

The
Trademarks

 

 

Trademarks and
master brand names used in the United States and countries comprising the
“Territories” as defined in Schedule 3 on or prior to December 1, 1996, by
companies affiliated with Weider Health and Fitness, a Nevada corporation, in
the advertising, labelling, marketing and distribution of “Products” as defined
in Schedule 2.

 

Notwithstanding the
foregoing, the “Trademarks” shall exclude the trademark “WEIDER”, the
“WEIDER”-formative trademarks and such other trademarks as are more specifically
set forth in Schedule 4. 

 

For greater
certainty, the Trademarks shall include, without limitation, the following
trademarks:

 

	
      Trade-Mark

       
	 
	
      FAT MANAGER
      
	 
	
      FI-BAR &
      Design 
	 
	
      FI-BAR
	 
	
       

      MOVE FREE
      
	 
	
      SCHIFF
      
	 
	
      SCHIFF
      APPETTROL 
	 
	
      SCHIFF COLD
      GARD 
	 
	
      SCHIFF
      JOINT-AID 
	 
	
      TIGER'S MILK
      
	 
	
      VITALISLIM
      
	 

 

 

 

 

EXHIBIT
5

 

 

 

SCHEDULE
4

 

 

WEIDER
TRADEMARKS

 

All “Weider”
trademarks, all “Weider”-formative trademarks and all other trademarks and
master brand names listed below.

 

For greater
certainty, the Trademarks shall include, without limitation, the following
trademarks:

 

 

 

(For the purpose of
this Agreement, only the trademark classes relating to nutritional goods
specifically in relation to the Products shall be included. For greater
certainty, international classes 16, 25, 28 and 41 (as well as their equivalent
local classes) are specifically excluded)

	
      Trade-Mark

       

	
      DYNAMIC CARBO
      ENERGIZER & Design 

	
      BODY SHAPER
      

	
      JOE WEIDER
      & Design 

	
      JOE WEIDER
      

	
      JOE WEIDER
      SIGNATURE 

	
      JOE WEIDER'S
      

	
      JOE WEIDER'S
      OLYMPIAN & Design 

	
      JOE WEIDER'S
      OLYMPIAN & Torch Design 

	
      JOE WEIDER'S
      OLYMPIAN MUSCLE BUILDER 

	
      JOE WEIDER'S
      VICTORY & Design 

	
      JOE WEIDER'S
      VICTORY 

	
      MEGA MASS
      

	
      MEGAMASS
      

	
      MEGAMASSE
      

	
      OLYMPIAN
      

	
      PERFORMANCE
      

	
      SPEED BOOSTER
      

	
      VICTORY
      

	
      W WEIDER
      & Design 

	
      W WEIDER
      & DEVICE 

	
      WEIDER &
      Design 

	
      WEIDER
      

	
      WEIDER 60
      YEARS OF EXCELLENCE & Design

	
      WEIDER
      OLYMPIAN 

	
      WEIDER
      SCIENCE 

	
      WEIDER ULTRA
      LEAN (CTM) 

	
      WEIDER;
      DesignExhibit 10.2 Purchase Agreement WNG and WGN

 

STOCK AND ASSET
PURCHASE AGREEMENT

by and
among

WEIDER GLOBAL
NUTRITION, LLC

and

WEIDER NUTRITION
INTERNATIONAL, INC. and

WEIDER NUTRITION
GROUP, INC.

dated as
of

April 1,
2005

TABLE
OF CONTENTS

                                                                                            Page

	
      ARTICLE
      I
	
      Certain
      Definitions
	
      0

	 	 	 
	
      ARTICLE
      II
	
      Closing;
      Purchase and Sale
	
      7

	 	 	 
	
      Section
      2.1.
	
      Time and
      Place of Closing
	
      7

	
      Section
      2.2.
	
      Assets Being
      Sold
	
      8

	
      Section
      2.3.
	
      Excluded
      Assets
	
      9

	
      Section
      2.4.
	
      Assumed
      Liabilities
	
      10

	
      Section
      2.5.
	
      Excluded
      Liabilities
	
      12

	
      Section
      2.6.
	
      Consideration
      for the Weider Assets.
	
      12

	
      Section
      2.7.
	
      Deliveries by
      Sellers
	
      13

	
      Section
      2.8.
	
      Deliveries by
      Buyer
	
      14

	
      Section
      2.9.
	
      Assignment of
      Contracts and Rights.
	
      15

	
      Section
      2.10.
	
      Indemnification.
	
      16

	
      Section
      2.11.
	
      Indemnity for
      Surviving Representations and Warranties; Limitation.
	
      17

	
      Section
      2.12.
	
      Sole
      Remedy
	
      17

	
      Section
      2.13.
	
      Sales
      Tax
	
      18

	 	 	 
	
      ARTICLE
      III
	
      Representations
      and Warranties of Sellers
	
      18

	 	 	 
	
      Section
      3.1.
	
      Organization,
      Standing and Power
	
      18

	
      Section
      3.2.
	
      Capitalization
	
      18

	
      Section
      3.3.
	
      Weider Assets
      Complete; Title to Weider Assets
	
      19

	
      Section
      3.4.
	
      Authority
	
      19

	
      Section
      3.5.
	
      Noncontravention
	
      19

	
      Section
      3.6.
	
      Absence of
      Undisclosed Liabilities
	
      20

	
      Section
      3.7.
	
      Absence of
      Changes
	
      20

	
      Section
      3.8.
	
      Litigation
	
      20

	
      Section
      3.9.
	
      Properties;
      Assets
	
      20

	
      Section
      3.10.
	
      Intangibles/Inventions
	
      20

	
      Section
      3.11.
	
      Tax
      Matters
	
      21

	
      Section
      3.12.
	
      Banks; Powers
      of Attorney
	
      21

	
      Section
      3.13.
	
      Employee
      Arrangements
	
      21

	
      Section
      3.14.
	
      Material
      Contracts
	
      21

	
      Section
      3.15.
	
      Insurance
	
      21

	
      Section
      3.16.
	
      Conduct of
      Business.
	
      21

	 	 	 
	
      ARTICLE
      IV
	
      Representations
      and Warranties of Buyer
	
      22

	 	 	 
	
      Section
      4.1.
	
      Organization,
      Standing and Power
	
      22

	
      Section
      4.2.
	
      Authority
	
      23

	
      Section
      4.3.
	
      Noncontravention
	
      23

 

 

- i -

 

	
      ARTICLE
      V
	
      Covenants of
      Sellers and Buyer
	
      23

	 	 	 
	
      Section
      5.1.
	
      Investigation
      of Business; Access to Properties and Records.
	
      23

	
      Section
      5.2.
	
      Agreement to
      Cooperate
	
      24

	
      Section
      5.3.
	
      Further
      Assurances; Contract Audits
	
      24

	
      Section
      5.4.
	
      No
      Disclosure.
	
      25

	
      Section
      5.5.
	
      Intangibles.
	
      25

	
      Section
      5.6.
	
      Intercompany
      Arrangements and Accounts.
	
      25

	
      Section
      5.7.
	
      Insurance
	
      26

	
      Section
      5.8.
	
      Collection of
      Receivables; Forwarding of Payments
	
      26

	
      Section
      5.9.
	
      Assignment of
      Export Rights
	
      26

	
      Section
      5.10.
	
      Facilities
      Inspection
	
      26

	
      Section
      5.11.
	
      Covenant Not
      to Compete; Nonsolicitation.
	
      26

	
      Section
      5.12.
	
      Ownership of
      International Subsidiary Stock
	
      27

	 	 	 
	
      ARTICLE
      VI
	
      Tax
      Matters
	
      27

	 	 	 
	
      Section
      6.1.
	
      Tax
      Representations
	
      27

	
      Section
      6.2.
	
      Allocation
	
      28

	
      Section
      6.3.
	
      Tax
      Obligations of Sellers
	
      28

	
      Section
      6.4.
	
      Tax
      Obligations of Buyer
	
      28

	
      Section
      6.5.
	
      Transfer
      Taxes; Apportionment of Taxes.
	
      28

	
      Section
      6.6.
	
      Refunds and
      Credits.
	
      29

	
      Section
      6.7.
	
      Cooperation
      and Exchange of Information.
	
      29

	
      Section
      6.8.
	
      Tax
      Contests.
	
      30

	 	 	 
	
      ARTICLE
      VII
	
      Conditions to
      Buyer’s Obligation to Close
	
      31

	 	 	 
	
      Section
      7.1.
	
      Representations,
      Warranties and Covenants of Sellers
	
      31

	
      Section
      7.2.
	
      No
      Order
	
      31

	
      Section
      7.3.
	
      Managing
      Member Authorization
	
      31

	
      Section
      7.4.
	
      Special
      Committee Authorization
	
      31

	
      Section
      7.5.
	
      Deliveries
	
      31

	
      Section
      7.6.
	
      Litigation
	
      31

 

- ii -

 

 

	
      Section
      7.7.
	
      Consents and
      Approvals
	
      32

	
      Section
      7.8.
	
      No
      Liens
	
      32

	
      Section
      7.9.
	
      Date of
      Consummation
	
      32

	 	 	 
	
      ARTICLE
      VIII
	
      Conditions to
      Sellers’ Obligation to Close
	
      32

	 	 	 
	
      Section
      8.1.
	
      Representations,
      Warranties and Covenants of Buyer
	
      32

	
      Section
      8.2.
	
      No
      Order
	
      33

	
      Section
      8.3.
	
      Board
      Authorization
	
      33

	
      Section
      8.4.
	
      Special
      Committee Authorization
	
      33

	
      Section
      8.5.
	
      Fairness
      Opinion
	
      33

	
      Section
      8.6.
	
      Resignation
      of Richard Blair
	
      33

	
      Section
      8.7.
	
      Deliveries
	
      33

	
      Section
      8.8.
	
      Litigation
	
      33

	
      Section
      8.9.
	
      Consents and
      Approvals
	
      33

	
      Section
      8.10.
	
      Date of
      Consummation
	
      34

	
       
	 	 
	
      ARTICLE
      IX
	
      Termination
	
      34

	 	 	 
	
      Section
      9.1.
	
      Termination
	
      34

	
      Section
      9.2.
	
      Procedure and
      Effect of Termination
	
      34

	 	 	 
	
      ARTICLE
      X
	
      Miscellaneous
	
      35

	 	 	 
	
      Section
      10.1.
	
      Counterparts
	
      35

	
      Section
      10.2.
	
      Governing
      Law; Jurisdiction; Waiver
	
      35

	
      Section
      10.3.
	
      Entire
      Agreement
	
      35

	
      Section
      10.4.
	
      Expenses
	
      35

	
      Section
      10.5.
	
      Notices
	
      35

	
      Section
      10.6.
	
      Successors
      and Assigns
	
      37

	
      Section
      10.7.
	
      Survival of
      Representations
	
      37

	
      Section
      10.8.
	
      Headings;
      Definitions
	
      37

	
      Section
      10.9.
	
      Amendments
      and Waivers
	
      37

	
      Section
      10.10.
	
      Interpretation
	
      37

	
      Section
      10.11.
	
      Tax Treatment
      and Tax Structure
	
      38

	
      Section
      10.12.
	
      Severability
	
      38

 

 

- iii
-

	
      LIST OF
      EXHIBITS

       
	 	 
	
      Exhibit
      2.7(a)
	
      Bill of
      Sale
	 
	
      Exhibit
      2.7(b)
	
      Assignment
      and Assumption Agreement
	 
	
      Exhibit
      2.7(c)
	
      Assignment
      and Assumption of Intangibles Agreement
	 
	
      Exhibit
      2.7(d)
	
      European
      Agreements
	 
	
      (d)(i)
	
      European
      Services Amendment
	 
	
      (d)(ii)
	
      Distribution
      Termination Agreement between Haleko Italia srl and Weider

	 
	 	
      Germany GmbH
      
	 
	
      (d)(iii)
	
      Distribution
      Termination Agreement between Haleko Hanseatisches
	 
	 	
      Lebensmittel
      Kontor GmbH & Co. OHG and Weider Nutrition, S.L.
	 
	
      Exhibit
      2.7(e)
	
      U.S.
      Transition Services Agreement
	 
	
      Exhibit
      2.7(f)
	
      Name License
      Agreement
	 
	
      Exhibit
      2.7(g)
	
      Lease
      Assignment Agreement
	 
	
      Exhibit
      2.7(h)
	
      Legal
      Opinion
	 
	
      Exhibit
      2.8(h) 
	
      Promissory
      Note
	 
	
      Exhibit
      2.8(i)
	
      Guarantee
	 

 

- i -

STOCK AND
ASSET PURCHASE AGREEMENT

 

THIS STOCK AND
ASSET PURCHASE AGREEMENT (this “Agreement”), is dated as of
April 1, 2005, by and between Weider Global Nutrition, LLC (“WGN”), a Nevada
limited liability company and a wholly owned subsidiary of Weider Health and
Fitness (“WHF”) on the one hand,
and Weider Nutrition International, Inc., a Delaware corporation (“WNI”) and its wholly
owned subsidiary, Weider Nutrition Group, Inc., a Utah corporation
(“WNG,” each of WNI and
WNG, a “Seller,” and together, the “Sellers”), on the other
hand.

 

WHEREAS, Sellers
are engaged in the business, among other activities, of advertising, marketing,
manufacturing and distributing products in the field of health and nutrition;

 

WHEREAS, a portion
of Sellers’ business consists of advertising, marketing and distributing the
Weider® branded products in the United States, its territories and possessions
(the “Domestic
Business”);

 

WHEREAS, Sellers
own indirectly all of the issued and outstanding capital stock (the
“International
Subsidiary Stock”) of each of
(i) Weider Nutrition Ltd. (“Weider
UK”),
(ii) Weider Nutrition Group Limited (“WNG
UK”),
(iii) Weider Germany GmbH (“Weider
Germany”),
(iv) Weider Nutrition SL (“Weider
Spain”), (v) Weider
Fitness SARL (“Weider
France”),
(vi) Weider Nutrition Group (Canada) Ltd. (“WNG
Canada”) and
(vii) Custom Nutrition, Inc. (Canada) (“CN
Canada” and, together
with Weider UK, WNG UK, Weider Germany, Weider Spain, Weider France and WNG
Canada, the “International
Subsidiaries”);

 

WHEREAS, the
International Subsidiaries are engaged in the business of advertising, marketing
and distributing the Weider® branded products in international markets (the
“International
Business,” together with
the Domestic Business, the “Weider Branded
Business”);
and

 

WHEREAS, WGN
(“Buyer”), wishes to
purchase and acquire from Sellers, and Sellers desire to sell to Buyer, the
Weider Branded Business (including certain specified assets and liabilities),
subject to and upon the terms and conditions hereinafter set forth.

 

NOW, THEREFORE, the
parties hereto, intending to be legally bound, agree as follows:

 

 

ARTICLE
I

 

Certain
Definitions

 

In addition to the
other defined terms set forth herein, as used in this Agreement, the following
terms shall have the following respective meanings:

 

“Action” shall mean any
pending, threatened or future action, suit, arbitration, inquiry, proceeding or
investigation by or before any court, arbitrator or Governmental Authority,
whether civil, criminal or other, and whether known or unknown, fixed or
contingent, at the Effective Date, so long as such Action is based on events
that occurred prior to the Effective Date.

 

- 1 -

 

 

“Affiliate” of a designated
person or party shall be any other person or entity who (or which) directly or
indirectly controls, is controlled by, or is under common control with, such
designated person; for such purposes, “control” (including, with correlative
meanings, the terms “controlling”, “controlled by” and “under common control
with”) means with respect to such designated person, the possession, directly or
indirectly, of the power to direct, or cause the direction of, the management or
policies of the designated person, whether through the ownership of voting
securities, by agreement or otherwise.

 

“Agreement” shall have the
meaning set forth in the first paragraph hereof, as such may be amended or
supplemented from time to time.

 

“Ancillary
Agreements” shall mean,
collectively, the Bill of Sale, the Assignment and Assumption Agreement, the
Assignment and Assumption of Intangibles Agreement, the European Agreements, the
Promissory Note, the Guarantee, the Name License Agreement, the Lease Assignment
Agreement and the U.S. Transition Services Agreement.

 

“Applicable
Laws” shall mean all
applicable international, national, federal, provincial, state and local laws,
statutes, ordinances, rules, regulations and codes.

 

“Assignment and
Assumption Agreement” shall have the
meaning set forth in Section 2.7(b).

 

“Assignment and
Assumption of Intangibles Agreement” shall have the
meaning set forth in Section 2.7(c).

 

“Balance
Sheet” shall mean the
Weider Branded Business unaudited consolidated and consolidating balance sheet
at March 1, 2005, prepared in accordance with historical accounting
policies.

 

“Bill of
Sale” shall have the
meaning set forth in Section 2.7(a).

 

“Business
Day” means any day
that is not a Saturday, a Sunday or other day on which banks are required by law
to be closed in the City of Los Angeles.

 

“Buyer” shall have the
meaning set forth in the Recitals hereof.

 

“Buyer
Group” shall have the
meaning set forth in Section
2.10(a).

 

“Cash” shall mean cash,
money market instruments, bank accounts, bank deposits, certificates of deposit,
lock box receipts, other cash equivalents, marketable securities and other
investment securities.

 

- 2 -

“Closing” shall have the
meaning set forth in Section 2.1.

 

“Closing
Date” shall mean the
third Business Day after the date on which the conditions set forth in Articles
VII and VIII (other than conditions precedent that are not capable of being
satisfied until the Closing) shall be satisfied or duly waived, or, if Sellers
and Buyer mutually agree on a different date, the date upon which they have
mutually agreed.

 

“Code” shall mean the
Internal Revenue Code of 1986, as amended.

 

“Consents” shall mean,
collectively, (a) each consent or novation with respect to any material
Weider Contract required to be obtained from the other party or parties thereto
by virtue of the execution and delivery of this Agreement or the consummation of
the transactions contemplated hereby in order to avoid the invalidity of the
transfer of such Weider Contract, the termination thereof, a breach or default
thereunder or any other change or modification to the terms thereof and
(b) each consent, approval, order, qualification and waiver required under
applicable law to be obtained by virtue of the execution and delivery of this
Agreement or the consummation of the transactions contemplated
hereby.

 

“Contract” shall mean any
contract, agreement, lease, indenture, evidence of indebtedness, binding
commitment or instrument, purchase order or written offer.

 

“Controlling
Party” shall have the
meaning set forth in Section 6.8(c).

 

“Copyrights” shall have the
meaning set forth in Section
3.10.

 

“CN
Canada” shall have the
meaning set forth in the Recitals.

 

“Definitive
Documents” shall have the
meaning set forth in Section 3.4.

 

“Domestic
Business” shall have the
meaning set forth in the Recitals.

 

“Effective
Date” shall mean March
1, 2005.

 

“Employment
Agreements” means all
contracts, agreements and commitments of Sellers or any of their subsidiaries
entered into with individual Weider Employee(s) prior to the date of this
Agreement relating to the employment, retention, severance or compensation of
such Weider Employee(s).

 

“European
Agreements” shall have the
meaning set forth in Section 2.7(d).

 

“Excluded
Assets” shall have the
meaning set forth in Section 2.3.

 

“Excluded
Contracts” shall mean the
Contracts identified on Schedule 2.3
(j).

 

“Excluded
Liabilities” shall have the
meaning set forth in Section 2.5.

 

- 3 -

“Excluded
Taxes” shall have the
meaning set forth in Section 6.3.

 

“Fairness
Opinion” shall have the
meaning set forth in Section 8.5.

 

“Formulas” shall have the
meaning set forth in Section 3.10.

 

“GAAP” shall mean United
States generally accepted accounting principles, as of the date hereof.

 

“Guarantee” shall have the
meaning set forth in Section
2.8(h).

 

“Governmental
Authority” shall mean any
federal, state, local, foreign or supranational governmental, judicial or
regulatory agency, entity or authority.

 

“Income
Taxes” shall mean Taxes
based on income, gain or similar items.

 

“Indemnified
Party” means the Buyer
Group or the Seller Group, as the case may be.

 

“Indemnifying
Party” means the Sellers
or Buyer, as the case may be.

 

“Insurance
Policies” shall have the
meaning set forth in Section 3.15.

 

“Intangibles” shall have the
meaning set forth in Section 3.10.

 

“International
Business” shall have the
meaning set forth in the Recitals.

 

“International
Subsidiary Stock” shall have the
meaning set forth in the Recitals.

 

“International
Subsidiaries” shall have the
meaning set forth in the Recitals.

 

“Inventions” shall mean all
inventions, discoveries, improvements, processes, technology, know-how and other
intellectual property, proprietary rights and trade secrets related exclusively
to the Domestic Business. Inventions shall not include trademarks, service
marks, trade names, trade dress or copyrights, nor any applications or
registrations for any of the foregoing.

 

“Knowledge of
WNI” shall mean the
actual knowledge of Joseph Baty, Thomas Elitharp, Daniel Thomson and Bruce
Wood.

 

“Legal
Opinion” shall have the
meaning set forth in Section
2.7(h).

 

“Lease Assignment
Agreement” shall have the
meaning in Section
2.7(g).

 

“Licenses” shall have the
meaning set forth in Section 3.10.

 

- 4 -

“Liens” shall mean all,
with respect to any given property(ies), encumbrances, defects of title, deeds
of trust, mortgages, security agreements, security interests, pledges, liens,
conditional sales agreements, claims, restrictions, charges, options, purchase
rights, voting trusts, leases, subleases, encroachments, covenants, easements
and/or rights of third parties of every kind and character arising or existing
by operation of law, by judicial decree or judgment or arbitral decision, by
contract or otherwise, whether or not accrued or fixed, absolute or contingent,
known or unknown, determined or determinable and whenever arising, including,
but not limited to, those evidenced by contracts, agreements, leases,
indentures, deeds of trust and security, conditional sale and other title
retention agreements.

 

“Loss” shall have the
meaning set forth in Section
2.10(a).

 

“Marks” shall have the
meaning set forth in Section 3.10.

 

“Material Adverse
Effect” shall mean a
material adverse effect on the operations, business, properties, assets,
liabilities, results of operations or financial condition of the Weider Branded
Business, taken as a whole. 

 

“Material
Contracts” shall mean those
contracts set forth on Schedule 3.14.

 

“Mixed Tax
Claim” shall have the
meaning set forth in Section 6.8(c).

 

“Name License
Agreement” shall have the
meaning set forth in Section
2.7(f).

 

“Names” shall mean all
names, marks, trade names and trademarks incorporating the Weider® name by
itself or in combination with any other Name, and all of the rights thereto and
goodwill represented thereby or pertaining thereto. 

 

“Non-Controlling
Party” shall have the
meaning set forth in Section 6.8(c).

 

“Permitted
Exceptions” means
(a) Liens for Taxes or governmental assessments, charges or claims the
payment of which is not yet due, or the validity of which is being contested in
good faith; (b) statutory liens of landlords and liens of repairmen,
carriers, warehousemen, mechanics, materialmen and other similar persons and
other liens imposed by Applicable Law incurred in the ordinary course of
business; (c) Liens relating to deposits and pledges made in the ordinary
course of business in connection with workers’ compensation, unemployment
insurance and other types of social security; (d) with respect to any asset
which consists of a leasehold estate or possessory interest in real property,
all Liens and other title matters (whether or not the same are recorded) to
which the underlying fee estate in such real property is subject; (e) Liens
securing the executory obligations of Sellers or any of its subsidiaries under
any lease that constitutes an “operating
lease” under GAAP;
(f) security interests granted in the ordinary course of business to the
lessors of leased equipment in respect of such leased equipment; (g) Liens
created in the ordinary course of business after the date of this Agreement; (h)
Liens that, individually or in the aggregate, would not reasonably be expected
to have a Material Adverse Effect and (i) the rights and interests of Buyer or
any Affiliate of Buyer as provided in this Agreement or any agreement entered
into pursuant to this Agreement.

 

- 5 -

“Pre-Effective
Tax Period” shall have the
meaning set forth in Section 2.3(h).

 

“Products” means all
products of any Seller or International Subsidiary manufactured, advertised,
promoted, distributed or sold under the Weider brand name.

 

“Product
Liabilities” shall mean
liabilities and obligations for property or economic damage, death or personal
injury or other product or strict liability claim or similar claims arising
from, caused by or attributable to, the manufacture, use, consumption or
purchase of any Product.

 

“Promissory
Note” shall have the
meaning set forth in Section 2.8(g).

 

“Proprietary
Identifiers” shall have the
meaning set forth in Section 3.10.

 

“Purchase
Price” shall have the
meaning set forth in Section 2.6(a).

 

“SEC” shall mean the
United States Securities and Exchange Commission.

 

“Section 1060
Statements and Forms” means a statement
described in Treasury Regulation Section 1.1060-1(e) and any
corresponding provision of any Tax Law with respect to Buyer’s acquisition of
the Weider Branded Business and all returns, documents, statements and other
forms that are required to be submitted in accordance with applicable Tax Laws
in connection therewith, including U.S. Internal Revenue Form 8594 (together
with any schedules or attachments thereto).

 

“Seller
Group” shall have the
meaning set forth in Section
2.10(a).

 

“Sellers” shall have the
meaning set forth in the first paragraph hereof.

 

“Selling
Stockholders” shall mean WNI,
WNG, WNG Holdings, WNI UK and Weider Nutrition BV collectively.

 

“Special
Committee” shall have the
meaning set forth in Section
2.7(j).

 

“Straddle
Period” shall mean a
taxable period beginning before the Effective Date and ending after the
Effective Date with respect to the Weider Assets.

 

“Superior
Offer” shall have the
meaning set forth in Section 9.1(c).

 

“Tax
Claim” shall have the
meaning set forth in Section 6.8(a).

 

“Taxes” or “Tax” shall mean
(a) any foreign, federal, state or local income, earnings, profits, gross
receipts, franchise, capital stock, net worth, sales, use, value added,
occupancy, general property, real property, personal property, intangible
property, transfer, fuel, excise, parking, payroll, withholding, unemployment
compensation, social security, retirement or other tax of any nature;
(b) any foreign, federal, state or local organization fee, qualification
fee, annual report fee, filing fee, occupation fee, assessment, other fee or
charge of any nature imposed by a governmental body; or (c) any deficiency,
interest or penalty imposed with respect to any of the foregoing.

 

- 6 -

 

 

“Tax
Laws” shall mean the
Code, federal, state, local or foreign laws relating to Taxes and any
regulations or official administrative pronouncements released
thereunder.

 

“Tax
Return” shall mean all
returns and reports, amended returns, information returns, statements,
declarations, estimates, schedules, notices, notifications, forms, elections,
certificates or other documents required to be filed or submitted to any
Governmental Authority with respect to the determination, assessment, collection
or payment of any Tax or in connection with the administration, implementation
or enforcement of, or compliance with, any Tax.

 

“Third-Party
Claims” shall have the
meaning set forth in Section
2.10(c).

 

“U.S. Transition
Services Agreement” shall have the
meaning set forth in Section 2.7(e).

 

“Weider
Assets” shall have the
meaning set forth in Section 2.2. 

 

“Weider Books and
Records” shall mean
originals or copies of, including relevant parts or portions of, all books and
records of Sellers and its subsidiaries (including the International
Subsidiaries) relating exclusively to the operations of the Weider Branded
Business, including all customer lists, mailing lists, distribution lists, price
lists, advertiser lists, sponsor lists, promotional and other contact lists and
all promotional and purchasing materials used exclusively in the Weider Branded
Business.

 

“Weider Branded
Business” shall have the
meaning set forth in the Recitals.

 

“Weider
Contracts” shall mean, other
than the Excluded Contracts, all: (a) Contracts related exclusively to the
Domestic Business pursuant to which any third party purchases the Products from
Sellers, (b) Contracts pursuant to which Sellers purchase any materials from any
third party for use exclusively in connection with the Domestic Business,
(c) Contracts exclusively relating to the distribution of the Products by
the Domestic Business, (d) Contracts involving any royalty, licensing or
similar arrangement relating exclusively to the Products, (e) Contracts
related exclusively to the Domestic Business pursuant to which any services are
provided to Sellers exclusively with respect to the Products or the Domestic
Business, (f) other Contracts entered into by Sellers from the date hereof
to the Closing Date exclusively relating to the Weider Domestic Assets or the
Domestic Business and (g) all Contracts listed on Schedule
1(a).

 

- 7 -

“Weider Domestic
Assets” shall have the
meaning set forth in Section
2.2.

 

“Weider
Employees” shall mean the
individuals listed on Schedule
1(b) hereto that are
employed by Sellers immediately prior to the Effective Date that will be
employed by Buyer from and after the Effective Date.

 

“Weider
France” shall have the
meaning set forth in the Recitals.

 

“Weider
Germany” shall have the
meaning set forth in the Recitals.

 

“Weider
Lease” means the lease
listed on Schedule
1(c)
hereto.

 

“Weider
Liabilities” shall have the
meaning set forth in Section 2.4. 

 

“Weider Nutrition
BV” shall mean Weider
Nutrition BV.

 

“Weider
Permits” shall have the
meaning set forth in Section
2.2(n).

 

“Weider
Spain” shall have the
meaning set forth in the Recitals.

 

“Weider
UK” shall have the
meaning set forth in the Recitals.

 

“WGN” shall have the
meaning set forth in the first paragraph hereof.

 

“WHF” shall have the
meaning set forth in the first paragraph hereof.

 

“WNG” shall have the
meaning set forth in the first paragraph hereof.

 

“WNG
Canada” shall have the
meaning set forth in the Recitals.

 

“WNG
Holdings” shall mean WNG
Holdings (International) LTD, Inc.

 

“WNG
UK” shall have the
meaning set forth in the Recitals.

 

“WNI” shall have the
meaning set forth in the first paragraph hereof.

 

“WNI
UK” shall mean Weider
Nutrition (WNI) Limited. 

 

ARTICLE
II

 

Closing;
Purchase and Sale

 

Section
2.1.  Time and Place
of Closing. The closing (the
“Closing”) of the purchase
of the Weider Assets and the assumption of the Weider Liabilities (as provided
for in this Article
II) shall take place
on the Closing Date at 10:00 A.M., Pacific Standard
Time, at the offices of Greenberg Glusker Fields Claman Machtinger &
Kinsella LLP, 1900 Avenue of the Stars, 21st Floor, Los
Angeles, California 90067.

 

- 8 -

 

 

Section
2.2.  Assets Being
Sold. Upon the terms
and subject to the satisfaction of all of the conditions set forth herein, on
the Closing Date Sellers will, and will cause their subsidiaries to, sell,
convey, assign, transfer and deliver to Buyer, with such sale, conveyance,
assignment, transfer and delivery being deemed effective as of the Effective
Date, all of Sellers’ and Sellers’ subsidiaries right, title and interest in the
International Subsidiary Stock and the Weider Domestic Assets (collectively, the
“Weider
Assets”), and Buyer will
purchase, acquire, accept and pay for, as hereinafter provided, the Weider
Assets and will assume and agree to pay, perform and discharge when due the
Weider Liabilities. Furthermore, the parties acknowledge that the Sellers have
previously delivered to Buyer the Balance Sheet. For purposes of this Agreement,
“Weider Domestic
Assets” shall mean all of
the right, title and interest of Sellers and their subsidiaries in and to all of
the assets, properties and rights, whether tangible or intangible, referred to
in Paragraphs (a)-(p) immediately below that are exclusively used in, or
exclusively related to, the Domestic Business (provided, however, that
notwithstanding the foregoing and the items set forth in Paragraphs (a)-(p)
immediately below, the Weider Domestic Assets shall not include any of the
Excluded Assets): 

 

(a)  all of the Weider
Contracts;

 

(b)  all
software, software systems, databases and database systems, whether owned,
leased or licensed by Sellers listed on Schedule
2.2(b);

 

(c)  all inventories
including raw materials, works in process and finished goods;

 

(d)  all customer lists,
mailing lists, distribution lists, price lists, advertiser lists and other
contact lists;

 

(e)  all promotional
materials and records;

 

(f)  all accounts
receivable;

 

(g)  all credits,
prepaid expenses and security deposits of Sellers;

 

(h)  all of the
Intangibles and all rights thereunder or in respect thereof, including, but not
limited to, rights to sue for and remedies against past, present and future
infringements thereof, and rights of priority and protection of interests
therein under the laws of any jurisdiction worldwide and all tangible
embodiments thereof;

 

(i)  all guarantees,
warranties, indemnities and similar rights in favor of the Sellers with respect
to any Weider Domestic Asset to the extent transferable;

 

(j)  all office
equipment listed
on Schedule
2.2(j);

 

(k)  all of Sellers’
right, title and interest under the Weider Lease;

 

- 9 -

(l)  any interest in or
right to any refund of Taxes relating to the Weider Domestic Assets, the
Domestic Business or the Weider Liabilities to the extent such Taxes are for, or
applicable to, any taxable period (or portion thereof) beginning after the
Effective Date (a “Post-Effective
Tax Period”);

 

(m)  to the extent their
transfer is permitted by Applicable Law, all Weider Books and
Records;

 

(n)  to the extent their
transfer is permitted by Applicable Law and assignable under the terms thereof,
all approvals, permits and authorizations of, or issued by, any Governmental
Authority, including all applications therefore, related exclusively to the
Domestic Business (the “Weider
Permits”);

 

(o)  all goodwill
relating to, or arising from, the Domestic Business; and

 

(p)  except as provided
for in Section 2.3 hereof, any and
all other assets of Sellers, real or personal, tangible or intangible, not
listed above that are exclusively used in or exclusively related to the Domestic
Business.

 

Section
2.3.  Excluded
Assets. The Weider Assets
shall not include (and Sellers shall retain all rights in) any assets of Sellers
other than the Weider Assets (the “Excluded
Assets”). Without
limiting the generality of the foregoing, the Excluded Assets shall include, and
Buyer acknowledges that there shall be excluded from the Weider Assets, the
following: 

 

(a)  Sellers’ and their
subsidiaries’ (excluding the International Subsidiaries) corporate books and
records, tax records, work papers and other books and records, other than the
Weider Books and Records;

 

(b)  Weider Books and
Records that Sellers are required by Applicable Laws to retain;

 

(c)  all human resources
and other employee-related files and records related to non-Weider Employees
and, to the extent required by Applicable Law, Weider Employees;

 

(d)  all software,
software systems, databases and database systems, whether owned, leased or
licensed by Sellers except those listed on Schedule
2.2(b) (excluding those
owned exclusively by the International Subsidiaries);

 

(e)  all computers,
printers, photocopiers, and other similar tangible personal property owned by
any Seller except those listed on Schedule
2.2(j) (excluding those
owned exclusively by the International Subsidiaries);

 

(f)  any insurance
policies of Sellers or its Subsidiaries (excluding the International
Subsidiaries) or rights thereunder or proceeds thereof;

 

- 10 -

 

(g)  all guarantees,
warranties, indemnities and similar rights in favor of the Sellers or any of
their Affiliates to the extent relating to (i) any other Excluded Asset, (ii)
any Excluded Liability or (iii) any matter to the extent Sellers indemnify Buyer
pursuant to Article X hereof;

 

(h)  any interest in or
right to any refund of Taxes of Sellers or their subsidiaries for any period,
and any interest in or right to any refund of Taxes relating to the Weider
Assets (other than refunds of Taxes to any International Subsidiary), the Weider
Branded Business or the Weider Liabilities for, or applicable to, any taxable
period (or portion thereof) ending on or prior to the Effective Date (a
“Pre-Effective
Tax Period”); 

 

(i)  any other assets of
Sellers listed on Schedule 2.3(i); 

 

(j)  any Contracts
listed on Schedule 2.3(j) (the “Excluded
Contracts”);
and

 

(k)  all intellectual
property rights not related exclusively to the Weider Branded Business,
including, without limitation, related to Sellers’ Schiff, Tiger’s Milk,
Multipower and Multaben branded products.

 

Section
2.4.  Assumed
Liabilities. On and subject to
the terms and conditions set forth in this Agreement, effective as of the
Effective Date, Buyer shall assume from Sellers and its subsidiaries and pay,
discharge, perform or otherwise satisfy the following liabilities and
obligations (whether or not fixed, contingent or absolute, accrued or unaccrued,
known or unknown), other than the Excluded Liabilities: 

 

(a)  all obligations and
liabilities of the International Subsidiaries and the Selling Stockholders
associated with, or resulting from, the purchase and ownership of the
International Subsidiary Stock, including the promissory notes and other
arrangements listed on Schedule
5.6(a);

 

(b)  all obligations and
liabilities of Sellers reflected on the Balance Sheet, including, but not
limited to, the following:

 

(i)  accrued
personnel-related expenses for Weider Employees (including, but not limited to,
expenses related to their hiring, severance payments, bonuses, medical and
workers’ compensation plans, accrued but unused vacation pay);

 

(ii)  all legal expenses
accrued in the ordinary course of business (not including Sellers’ legal
expenses related to the transactions contemplated by this
Agreement);

 

(iii)  royalty
payments;

 

(iv)  lease obligations;

 

(v)  non-U.S. income
Taxes due related to the Weider Branded Business; and
 

(vi)  outstanding
debt.

 

- 11 -

 

 

(c)  all obligations and
liabilities relating to trade accounts payable of the Weider Branded Business
whether accrued or payable prior to or after the Effective Date;

 

(d)  all obligations and
liabilities relating to promotions, rebates, returns, broker commissions and
chargebacks related to the Products occurring after the Effective Date
(regardless of when manufactured or offered, as applicable);

 

(e)  all obligations and
liabilities relating to Taxes (including non-U.S. income Taxes), other than the
Excluded Taxes;

 

(f)  all obligations and
liabilities associated with accounts receivables arising within seventy-five
(75) days prior to the Effective Date and any arising thereafter;

 

(g)  any severance costs
and obligations related to Weider Employees arising after the Effective
Date;

 

(h)  all obligations and
liabilities under the Weider Contracts, including any body builder contracts
except as set forth on Schedule
2.4(h); 

 

(i)  Product Liabilities
relating to the manufacturing, marketing, sale, distribution or use of a Product
or the operation of the Weider Branded Business on or after the Effective Date
(regardless of when manufactured);

 

(j)  all obligations and
liabilities relating to voluntary and involuntary recalls, seizures or
withdrawals of Products occurring on or after the Effective Date (regardless of
when manufactured);

 

(k)  all obligations and
liabilities under the Employment Agreements relating to employees of the
Domestic Business;

 

(l)  all obligations and
liabilities with respect to the Weider Permits to the extent relating to the
operation or conduct of the Weider Branded Business on and after the Effective
Date; 

 

(m)  all obligations and
liabilities under the Weider Lease; and 

 

(n)  all obligations and
liabilities arising out of, or incident to, the operation of the Weider Branded
Business on or after the Effective Date;

 

The foregoing
liabilities being assumed by Buyer are referred to hereinafter collectively as
the “Weider
Liabilities.”

 

- 12 -

 

Section
2.5.  Excluded
Liabilities. Except as
otherwise provided for in this Agreement, Buyer is not assuming and Sellers
shall remain bound by and liable for and pay, perform or otherwise
satisfy:

 

(a)  all obligations and
liabilities of Sellers or any of their Affiliates for Taxes to the extent
provided in Article VI;

 

(b)  all obligations and
liabilities of Sellers or any of its subsidiaries (other than the International
Subsidiaries) for borrowed money or in respect of any other long-term
indebtedness, including indebtedness under any bank lines of credit or bank
credit agreements except those obligations and liabilities relating exclusively
to the Domestic Business to the extent they are set forth on the Balance
Sheet;

 

(c)  all obligations and
liabilities of Sellers which are expressly retained by them pursuant to this
Agreement and the Ancillary Agreements;

 

(d)  all obligations and
liabilities of Sellers under the Excluded Contracts;

 

(e)  any severance costs
and obligations related to United States-based employees of the Weider Branded
Business other than the Weider Employees; 

 

(f)  all liabilities
related to accounts receivable arising prior to seventy-five (75) days prior to
the Effective Date; 

 

(g)  Product Liabilities
relating to the marketing, advertising, sale, distribution or use of a Product
and/or the operation of the Weider Branded Business, in each case, prior to the
Effective Date; and

 

(h)  any and all claims,
liabilities and obligations relating to or arising from the Excluded
Assets.

 

The foregoing
liabilities not being assumed by Buyer are referred to hereinafter collectively
as the “Excluded
Liabilities.”

 

Section
2.6.  Consideration
for the Weider Assets.

 

(a)  Closing Date
Purchase Price. In consideration
of the sale, transfer, conveyance and assignment of the Weider Assets by Sellers
(and its subsidiaries) to Buyer at the Closing, subject to the terms and
conditions of this Agreement, Buyer shall pay to Sellers an aggregate amount
equal to Fourteen Million Dollars ($14,000,000) (US), which shall be payable as
follows: Twelve Million Nine Hundred Thousand Dollars in cash and One Million
One Hundred Thousand Dollars ($1,100,000)(US) pursuant to the Promissory Note
(the “Purchase
Price”).

 

- 13 -

 

(b)  All payments to be
made on the Closing Date pursuant to this Section 2.6 shall be made in
United States Dollars, by wire transfer of immediately available funds to the
account or accounts specified in writing by Sellers on or prior to the Closing
Date.

 

Section
2.7.  Deliveries by
Sellers. At the Closing,
Sellers shall deliver the following to Buyer:

 

(a)  a duly executed
bill of sale substantially in the form attached hereto as Exhibit
2.7(a) (the
“Bill of
Sale”) transferring to
Buyer all of the personal property owned or held by Sellers as of the Effective
Date which are included in the Weider Assets free and clear of any and all
material Liens, security interests and encumbrances of any nature
whatsoever;

 

(b)  a duly executed
instrument of assignment and assumption substantially in the form attached
hereto as Exhibit
2.7(b) hereto (the
“Assignment and
Assumption Agreement”) pursuant to
which Sellers will delegate to Buyer, and Buyer will assume, all of the Weider
Liabilities; 

 

(c)  a duly executed
instrument of assignment and assumption of the Intangibles substantially in the
form attached hereto as Exhibit
2.7(c) hereto (the
“Assignment and
Assumption of Intangibles Agreement”);

 

(d)  a duly executed
amendment to the services agreement for Europe substantially in the form
attached hereto as Exhibit
2.7(d)(i), a duly executed
distribution termination agreement between Haleko Italia srl and Weider Germany
GmbH substantially in the form attached hereto as Exhibit
2.7(d)(ii) and a duly
executed distribution termination agreement between Haleko Hanseatisches
Lebensmittel Kontor GmbH & Co. OHG and Weider Nutrition, S.L. substantially
in the form attached hereto as Exhibit
2.7(d)(iii) (collectively, the
“European
Agreements”);

 

(e)  a duly executed
transition services agreement for the United States substantially in the form
attached hereto as Exhibit
2.7(e) (the “U.S. Transition
Services Agreement”);

 

(f)  a duly executed
license agreement for the use of the Names substantially in the form attached
hereto as Exhibit
2.7(f) (the “Name License
Agreement”);

 

(g)  a duly executed
instrument of lease assignment and assumption substantially in
the form attached hereto as Exhibit
2.7(g) (the “Lease Assignment
Agreement”);

 

(h)  a legal opinion
substantially in the form attached hereto as Exhibit
2.7(h) (the “Legal
Opinion”);

 

(i)  a copy of the
resignation(s) of Richard Blair required under Section 8.6;

 

(j)  the officer’s
certificate required under Section 7.1(along with an
incumbency certificate); 

 

- 14 -

 

(k)  a copy of the
resolutions adopted by the (i) Boards of Directors of each Seller and Selling
Stockholder (other than in the case of WNI UK), in each case, authorizing the
execution, delivery and performance of this Agreement by Sellers and the
transfer and conveyance of the International Subsidiary Stock, as applicable,
and (ii) the Special Committee of the Board of Directors (the “Special
Committee”) recommending to
the Board of Directors of WNI that the Sellers approve, execute, deliver and
perform the Agreement; and certificates of the Secretary, Assistant Secretary or
other authorized person of Sellers and each Selling Stockholder, as applicable,
dated as of the Closing Date, that such resolutions were duly adopted and are in
full force and effect as of the Closing Date;

 

(l)  certified copies of
the Certificate of Incorporation and the Bylaws of each Seller;

 

(m)  to the extent
applicable, stock certificates representing all of the issued and outstanding
stock of all of the International Subsidiaries together with duly executed stock
assignments separate from the stock certificates in favor of Buyer;
and

 

(n)  a copy of the
Fairness Opinion.

 

Section
2.8.  Deliveries by
Buyer. At the Closing,
Buyer shall deliver, and in the case of the Guarantee, shall cause WHF to
deliver, the following to Sellers:

 

(a)  Cash in the amount
of Twelve Million Nine Hundred Thousand Dollars ($12,900,000), by wire transfer
of immediately available funds to the bank account(s) designated by Sellers
pursuant to Section 2.6(a) above;

 

(b)  a duly executed
copy of the Assignment and Assumption Agreement;

 

(c)  a duly executed
copy of the Assignment and Assumption of Intangibles Agreement;

 

(d)  a duly executed
copy of the U.S. Transition Services Agreement;

 

(e)  a duly executed
copy of the Name License
Agreement;

 

(f)  a duly executed
copy of the Lease Assignment Agreement;

 

(g)  a duly executed
promissory note in favor of the Sellers in the form attached hereto as
Exhibit
2.8(g) (the
“Promissory
Note”) pursuant to
which Buyer agrees to pay Sellers the amount on the terms set forth
therein;

 

(h)  a duly executed
guarantee in the form attached hereto as Exhibit
2.8(h) pursuant to which
WHF guarantees the obligations of Buyer under this Agreement and the Ancillary
Agreements and agrees to be bound by the terms of Section 5.11 hereof (the
“Guarantee”);

 

- 15 -

 

(i)  the officer’s
certificate required under Section 8.1;

 

(j)  cash in the amounts
due to Sellers as set forth on Schedule 5.6(b) by wire transfer in immediately
available funds to the account(s) designated by Sellers pursuant to Section
2.6(a) above; 

 

(k)  a certified copy of
the Articles of Organization and Operating Agreement of Buyer;

 

(l)  a certificate of
good standing of Buyer from the Secretary of State of Nevada;

 

(m)  a copy of the
resolutions adopted by the Managing Member (as defined in the Buyer’s Operating
Agreement) of Buyer authorizing the execution, delivery and performance of this
Agreement by Buyer; and

 

(n)  a copy of the
resolutions adopted by the Board of Directors of the Managing Member of Buyer
authorizing the Buyer, to execute, deliver and perform this
Agreement.

 

Section
2.9.  Assignment of
Contracts and Rights.

 

(a)  Anything in this
Agreement to the contrary notwithstanding, this Agreement shall not constitute
an agreement (i) to transfer or assign any Weider Asset, or any claim,
right or benefit arising under such Weider Asset, or (ii) to enter into or
consummate any of the Ancillary Agreements if, without the consent of a third
party, such transfer and assignment or other transaction would constitute a
breach of, or default under, any agreement to which Sellers or their Affiliates
are parties, or would, in any material way, adversely affect the rights of Buyer
or its Affiliates or Sellers or their Affiliates under any Weider
Asset.

 

(b)  If any such consent
is not obtained prior to Closing and as a result thereof Buyer shall be
prevented by such third party from receiving the rights and benefits with
respect to such Weider Asset (or such other transaction) intended to be
transferred hereunder, or if an attempted assignment thereof (or such
transaction) would be ineffective or would adversely affect the rights of
Sellers thereunder so that Buyer would not in fact receive all such rights,
Sellers and Buyer will cooperate in any lawful and commercially reasonable
arrangement, as Buyer and Sellers shall agree, under which Buyer would, to the
extent practicable, obtain the economic claims, rights and benefits under such
asset and assume the economic burdens, liabilities and obligations with respect
thereto in accordance with this Agreement, including by subcontracting,
sublicensing, or subleasing to Buyer. Sellers will promptly pay to Buyer when
received all monies received by Sellers under any such Weider Asset or any
claim, right or benefit arising thereunder, and Buyer will indemnify and
promptly pay Sellers for all liabilities of Sellers associated with such Weider
Asset that arise due to the fact that such asset was not transferred to Buyer on
the Closing Date.

 

- 16 -

 

Section
2.10.  Indemnification.

 

(a)  Products
Liability Indemnity. Sellers shall
indemnify, defend and hold harmless Buyer, its Affiliates, shareholders,
members, managers, officers, directors, successors, assigns and agents
(collectively, “Buyer
Group”) from and against
all damages, losses, liabilities and expenses (including reasonable attorney’s
fees) (hereinafter, a “Loss”) arising from
claims asserted against, resulting to, imposed upon or incurred by any member of
the Buyer Group relating to, or resulting from, any Product Liabilities for
Products sold prior to the Effective Date, other than for claims that arise from
the Weider Liabilities. Buyer shall indemnify, defend and hold harmless Sellers,
its Affiliates, shareholders, officers, directors, successors, assigns and
agents (collectively, “Seller
Group”) from and against
all damages, losses, liabilities and expenses (including reasonable attorney’s
fees) arising from claims asserted against, resulting to, imposed upon or
incurred by any member of the Seller Group relating to, or resulting from, any
Product Liabilities for Products manufactured and sold following the Effective
Date. For clarification, this Section 2.10 shall survive closing.

 

(b)  Indemnity for
Broker’s and Finder’s Fees. Sellers shall
indemnify, defend and hold harmless Buyer Group from and against all claims of
third parties claiming compensation, commissions or expenses for services as a
broker or finder provided to Sellers related to the transactions contemplated by
this Agreement. Buyer shall indemnify, defend and hold harmless Seller Group
from and against all claims of third parties claiming compensation, commissions
or expenses for services as a broker or finder provided to Buyer related to the
transactions contemplated by this Agreement.

 

(c)  Indemnification
Procedures. An Indemnified
Party shall give the Indemnifying Party notice of any matter that an Indemnified
Party has determined has given or could give rise to a right of indemnification
under this Agreement, within 60 days of such determination, stating the amount
of the Loss, if known, and method of computation thereof, and containing a
reference to the provisions of this Agreement in respect of which such right of
indemnification is claimed or arises. The obligations and liabilities of the
Indemnifying Party under this Section
2.10 with respect to
Losses arising from claims of any third party that are subject to the
indemnification provided for in this Section
2.10 (“Third-Party
Claims”) shall be
governed by and be contingent upon the following additional terms and
conditions: if an Indemnified Party shall receive notice of any Third-Party
Claim, the Indemnified Party shall give the Indemnifying Party notice of such
Third-Party Claim within 30 days of the receipt by the Indemnified Party of
notice of such Third-Party Claim; provided, however, that the failure
to provide such notice to the Indemnifying Party shall not release the
Indemnifying Party from any of its obligations under this Section
2.10 except to the
extent that the Indemnifying Party is materially prejudiced by such failure and
shall not relieve the Indemnifying Party from any other obligation or liability
that it may have to any Indemnified Party otherwise than under this Section 2.10. If the
Indemnifying Party acknowledges in writing its obligation to indemnify the
Indemnified Party hereunder against any Losses that may result from such
Third-Party Claim, then the Indemnifying Party shall be required to assume and
control the defense of such Third-Party Claim at its expense and through counsel
of its choice; provided, however, that if there
exists or is reasonably likely to exist a conflict of interest 

 

- 17 -

that would make it
inappropriate in the judgment of the Indemnified Party in its reasonable
discretion for the same counsel to represent both the Indemnified Party and the
Indemnifying Party, then the Indemnified Party shall be entitled to retain its
own counsel in each jurisdiction for which the Indemnified Party determines
counsel is required, which counsel shall be reasonably acceptable to the
Indemnifying Party, at the expense of the Indemnifying Party. Upon the
Indemnifying Party’s assuming the defense against the Third-Party Claim as
provided above, the Indemnified Party shall cooperate with the Indemnifying
Party in such defense and make available to the Indemnifying Party, at the
Indemnifying Party’s expense, all witnesses, pertinent records, materials and
information in the Indemnified Party’s possession or under the Indemnified
Party’s control relating thereto as is reasonably required by the Indemnifying
Party. Similarly, if for any reason, the Indemnified Party is, directly or
indirectly, conducting the defense against any such Third-Party Claim, the
Indemnifying Party shall cooperate with the Indemnified Party in such defense
and make available to the Indemnified Party, at the Indemnifying Party’s
expense, all such witnesses, records, materials and information in the
Indemnifying Party’s possession or under the Indemnifying Party’s control
relating thereto as is reasonably required by the Indemnified Party. No such
Third-Party Claim may be settled by the Indemnifying Party without the prior
written consent of the Indemnified Party, which consent shall not be
unreasonably withheld; provided, however, that in the event
that the Indemnified Party withholds unreasonably withholds its consent to a
settlement, the Indemnified Party shall indemnify and hold harmless the
Indemnifying Party against any Losses suffered by the Indemnifying Party as a
result of the Indemnified Party’s withholding of its consent to such settlement
proposal. The Indemnifying Party will make promptly any payment required to be
made by it to the Indemnified Party under this Section
2.10.

 

Section
2.11.  Indemnity for
Surviving Representations and Warranties; Limitation. 

 

(a)  Sellers shall
indemnify, defend and hold harmless Buyer Group from and against any and all (i)
Losses arising from claims asserted against, resulting from, imposed upon or
incurred by any member of the Buyer Group or (ii) Losses incurred by the Weider
Branded Business, relating to, or resulting from, any breach by a Seller of any
of the surviving representations and warranties set forth in Section
10.7. 

 

(b)  Notwithstanding
anything in this agreement to the contrary, Sellers shall not be liable to
indemnify Buyer Group for any Losses pursuant to Section 2.11(a) until the
aggregate amount of such Losses exceeds One Hundred Thousand Dollars ($100,000)
at which time Sellers shall be liable to indemnify Buyer Group for the aggregate
amount of such Losses in excess of such $100,000 threshold. The maximum
aggregate indemnification obligation of Sellers with respect to
Section 2.11(a) shall in no event exceed Two Million Dollars
($2,000,000).

 

Section
2.12.  Sole
Remedy. Except for claims
for fraud, bad faith or willful malfeasance, the indemnification provided in
Sections 2.10 and 2.11 shall be the sole and exclusive remedy after the Closing
Date for damages available to Buyer for Losses described in Section 2.10 and
Section 2.11 and in no event shall Buyer be entitled to offset the amount of any
damages for such Losses against any amounts due to Sellers under the Promissory
Note.

 

- 18 -

 

Section
2.13.  Sales
Tax. Each of Sellers
and Buyer shall be responsible for fifty percent (50%) of any sales and use
taxes arising out of the sale of the Weider Assets as contemplated by this
Agreement. In addition, Buyer shall pay its pro-rata portion of state and local
real and personal property taxes, if any, payable with respect to any Weider
Assets (it being understood that Sellers are responsible for the portion up to
the Effective Date and Buyer is responsible for the portion from and after the
Effective Date).

 

 

ARTICLE
III

 

Representations
and Warranties of Sellers

 

Sellers hereby
jointly and severally represent and warrant to Buyer as follows, except as
otherwise set forth on the Schedules hereto:

Section
3.1.  Organization,
Standing and Power. Each of WNI and
WNG is a corporation duly organized, validly existing and in good standing under
the laws of the States of Delaware and Utah, respectively, with full corporate
power and corporate authority to (a) own, lease and operate its properties,
(b) carry on the Domestic Business as currently conducted by it, and
(c) execute, deliver and perform under this Agreement, the Ancillary
Agreements and each other agreement and instrument to be executed and delivered
by it pursuant hereto. In addition, each International Subsidiary is a business
entity duly organized, validly existing and in good standing under the laws of
each of the countries or other jurisdictions set forth opposite such
Subsidiary’s name in Schedule 3.1, with full power
and authority to (i) own, lease and operate its properties, and
(ii) carry on the International Business as currently conducted by it.
There are no countries, states or other jurisdictions in which the character and
location of any of the Weider Assets owned or leased by a Seller or the conduct
of the Domestic Business, or the character or location of any properties owned
or leased by any International Subsidiary or the conduct of the International
Business, would make it necessary for a Seller or any International Subsidiary,
as the case may be, to qualify to do business as a foreign corporation, except
where the failure to so qualify would not have a Material
Adverse Effect or would not interfere with the ability of the Sellers or any
International Subsidiary to consummate the transactions contemplated by this
Agreement. True and complete
copies of the charter documents of each International Subsidiary, and all
amendments thereof, have heretofore been furnished to Buyer. 

 

Section
3.2.  Capitalization. The outstanding
capital stock of each International Subsidiary is set forth in Schedule 3.2. All of the
International Subsidiary Stock is owned as of record by the applicable corporate
entities set forth in Schedule 3.2, and no person or
entity other than the Selling Stockholders, own, directly or indirectly or
beneficially or of record, any such International Subsidiary Stock, and all such
International Subsidiary Stock has been duly authorized, validly issued, fully
paid and is nonassessable. Schedule 3.2 sets forth a true
and complete list of the holders of all outstanding options and warrants issued
by any International Subsidiary, which options and warrants are held by such
holders in the amounts set forth on Schedule 3.2.

 

- 19 -

 

Section
3.3.  Weider Assets
Complete; Title to Weider Assets. To the Knowledge
of WNI, set forth on Schedule 3.3 is a complete list of the Weider Domestic
Assets, and to the Knowledge of WNI, except for the item listed on Schedule 3.5
relating to Mariz Gestao E Investimentos Limitada, the Weider Domestic Assets
listed on Schedule 3.3 along with the International Subsidiary Stock and the
services provided under the U.S. Transition Services Agreement constitute all of
the assets (including, but not limited to, tangible and intangible assets,
contracts and permits) necessary to enable the Buyer to conduct the Weider
Branded Business in a manner substantially similar to the way in which the
Weider Branded Business was conducted immediately prior to the Effective Date,
except for any such failure to include an asset or service that would not have a
Material Adverse Effect. To the Knowledge of WNI, Sellers have good and
marketable title to all of the Weider Assets and will transfer and convey such
good and marketable title to the Weider Assets to Buyer effective as of the
Effective Date, except for any such failure that would not have a Material
Adverse Effect.

 

Section
3.4.  Authority. The execution and
delivery by each Seller of this Agreement, the Ancillary Agreements and of all
of the other agreements to which it is a party (collectively, the “Definitive
Documents”), the performance
by each Seller of its obligations hereunder and thereunder, and the consummation
of the transactions contemplated hereby and thereby, have been duly and validly
authorized by all necessary corporate action on the part of each Seller, and
each Seller has all necessary corporate power and corporate authority with
respect thereto. Each other Selling Stockholder has all necessary corporate
power and corporate authority to sell, transfer and convey to Buyer all
International Subsidiary Stock owned by it, free and clear of any and all Liens.
This Agreement is, and when executed and delivered by each Seller will be, the
valid and binding obligations of the Sellers, enforceable against each in
accordance with its respective terms, except as the same may be limited by
bankruptcy, insolvency, reorganization, moratorium or other laws affecting the
rights of creditors generally and subject to the rules of law governing (and all
limitations on) specific performance, injunctive relief and other equitable
remedies.

 

Section
3.5.  Noncontravention. Except as set
forth on Schedule 3.5, neither the
execution and delivery by the Sellers of this Agreement or of any Ancillary
Agreement to be executed and delivered by them, nor the consummation of any of
the transactions contemplated hereby or thereby, nor the performance by them (or
any other Selling Stockholder) of any of their respective obligations hereunder
or thereunder, will (a) conflict with or result in a material breach of or
a default under any provision of their respective Articles or Certificate of
Incorporation, Bylaws, or other charter documents, as amended to date,
(b) give rise to a default, or any right of termination, cancellation or
acceleration, or otherwise be in conflict with or result in a loss of
contractual benefits, under any material note, bond, mortgage, indenture,
license, agreement or other instrument or obligation to which any of the Sellers
or any other Selling Stockholder is a party or by which any of them or their
respective assets may be bound or affected, or require any consent, approval or
notice under the terms of any such document or instrument, (c) violate any
order, writ, injunction, decree, law, statute, rule or regulation of any court
or Governmental Authority which is applicable to any of them or (d) result
in the creation or imposition of any material Lien (other than Permitted
Exceptions) upon any of the Weider Assets, except, in
the cases of clauses (b), (c) and (d) above, as would not have a Material
Adverse Effect.

 

- 20 -

 

Section
3.6.  Absence of
Undisclosed Liabilities. To the Knowledge
of WNI, none of the Sellers, the other Selling Stockholders nor the
International Subsidiaries have any material liabilities or obligations, whether
accrued, matured, unmatured, absolute, contingent, direct or indirect or
otherwise, related exclusively to the Weider Branded Business, which: (a) (i)
have not been reflected on the Balance Sheet, (ii) have not been incurred in the
ordinary course of business since the date of the Balance Sheet or (iii) in the
case of other types of liabilities and obligations not customarily reflected on
a consolidated balance sheet prepared in accordance with historical accounting
policies, have not been expressly described in Schedule
3.6, or (b) with
respect to each of clauses (i) (ii) or (iii) above, would be reasonably expected
to have a Material Adverse Effect on the Weider Branded Business.

 

Section
3.7.  Absence of
Changes. Except as set
forth in Schedule 3.7, since March 1,
2005, there have not been any material changes in the condition (financial or
otherwise) of the Weider Assets or the Weider Branded Business that would have a
Material Adverse Effect on the Weider Branded Business.

 

Section
3.8.  Litigation. Except as set
forth in Schedule
3.8, there are no
claims, suits or actions, or administrative, arbitration or other proceedings or
governmental investigations, pending or, to the Knowledge of WNI, threatened,
against or relating to either Seller, any other Selling Stockholder or any
International Subsidiary (but only as it relates to the Weider Branded
Business) which would
result in a Material Adverse Effect. 

 

Section
3.9.  Properties;
Assets. To the Knowledge
of WNI, all facilities, structures, equipment and other personal property
forming a part of the Domestic Assets and utilized in the Weider Branded
Business are owned or leased by a Seller. Except as set forth on Schedule 3.9, each of the
Sellers has good
and marketable title to all of its and their respective Weider Domestic Assets,
free and clear of all material Liens and Permitted Exceptions.

 

Section
3.10.  Intangibles/Inventions. To the Knowledge
of WNI, Schedule 3.10 identifies (by a
summary description) the following (A) all United States and foreign patents,
trademarks and trade name registrations, trademarks and trade names, fictitious
names, and service marks and service mark registrations, and all applications
therefor, which are currently used exclusively in connection with the Domestic
Business (collectively, the “Marks”), (B) copyright
applications and registrations for works or authorship currently used
exclusively in connection with the Domestic Business (collectively, the
“Copyrights”), (C) Internet domain names, proprietary 800 and 888 prefix phone
numbers, Internet URLs and other similar identifiers and proprietary rights
which are currently used exclusively in connection with the Domestic Business
(collectively, the “Proprietary
Identifiers”), (D) all product
formulas for all products currently marketed exclusively in connection with the
Domestic Business (“Formulas”) and (E) all
licenses and other agreements to which a Seller is a party or otherwise bound
which relate to any of the Inventions or a Seller’s use thereof in connection
with the Domestic Business (collectively, the “Licenses”, and together
with the Marks, Proprietary Identifiers and the Inventions, the “Intangibles”).

 

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Section
3.11.  Tax
Matters. Except as set
forth in Schedule 3.11, each Seller, each other
Selling Stockholder and each International Subsidiary, as applicable, has filed
with the appropriate governmental agencies all Tax Returns and reports required
to be filed by it, and has paid in full or contested in good faith (and made
adequate provision for) the payment of Taxes (as hereinafter defined) due and
owing (whether or not shown on any Tax Return).

 

Section
3.12.  Banks; Powers of
Attorney. To the Knowledge
of WNI, Schedule 3.12 is a complete and
correct list showing (a) the names of each bank in which each International
Subsidiary has one or more account(s) and safe deposit box(es), and the names of
all persons authorized to draw thereon or who have access thereto, and
(b) the names of all persons, if any, holding powers of attorney from any
Selling Stockholder or any International Subsidiary with respect to any such
account(s).

 

Section
3.13.  Employee
Arrangements. In regards to the
Weider Employees, to the Knowledge of WNI, Schedule 3.13 is a complete and
correct list and summary description of all (a) union, collective
bargaining, employment, management, termination and consulting agreements to
which any Seller or any International Subsidiary is a party or otherwise bound,
and (b) compensation plans and arrangements; bonus and incentive plans and
arrangements; deferred compensation plans and arrangements; pension and
retirement plans and arrangements; profit-sharing and thrift plans and
arrangements; stock purchase and stock option plans and arrangements;
hospitalization and other life, health or disability insurance. 

 

Section
3.14.  Material
Contracts. To the Knowledge
of WNI, Schedule 3.14 is a complete and
correct list of all Weider Contracts where the obligations payable to third
parties by Sellers, or the obligations payable to Sellers by third parties,
exceeds $100,000 on an annual basis. Complete and correct copies of the Weider
Contracts set forth on Schedule
3.14 have been made
available for review by Buyer.

 

Section
3.15.  Insurance. Each Seller
maintains valid policies of insurance covering the Domestic Business (the
“Insurance
Policies”) set forth in
Schedule 3.15, including all
legally-required workers’ compensation insurance, casualty, fire and general
liability insurance. 

 

Section
3.16.  Conduct of
Business.

 

(a)  The Sellers
represent and warrant that from the Effective Date to the Closing Date, to the
Knowledge of WNI, no Seller nor any International Subsidiary has:

 

(i)  made any material
(a) cash expenditures that are not in the ordinary course of business, (b)
dividends or other cash distributions to stockholders or (c) any other cash
transfers, other than as expressly set forth in this Agreement, that would
materially impact the cash or cash equivalents of the Weider Branded Business;

 

(ii)  entered into or
materially amended, modified or terminated any Employment Agreement, consulting
agreement or other employment, severance, retention, compensation or similar
contracts or agreement with any Weider Employee;

 

- 22 -

 

(iii)  increased in any
material manner the compensation of, or benefits payable to, any Weider Employee
other than, with respect to employees other than officers, in the ordinary
course of business consistent with past practice (in terms of amount, timing and
scope) or other than was required by Applicable Law or existing contractual
arrangements; or

 

(iv)  created, incurred
or assumed any material indebtedness or assumed, guaranteed, endorsed or
otherwise become liable or responsible for any material liabilities of any other
person that constituted or comprised Weider Liabilities.

 

(b)  Furthermore, the
Sellers represent and warrant that from the Effective Date to the Closing Date,
to the Knowledge of WNI, each Seller and each International Subsidiary
has:

 

(i)  used commercially
reasonable efforts to cause the Weider Branded Business to be conducted in the
ordinary course consistent with past practice in all material respects;

 

(ii)  used commercially
reasonable efforts to preserve the Weider Branded Business’ organization and
goodwill intact in all material respects;

 

(iii)  with respect to the
Weider Branded Business, kept its financial books of account, records and files
comprising Weider Books and Records consistent with past practice in all
material respects; and 

 

(iv)     used commercially reasonable
efforts to continue to maintain material existing business relationships with
suppliers and customers of the Weider Branded Business other than relationships
that Sellers reasonably determined in its sole discretion were not economically
beneficial to the Weider Branded Business.

 

ARTICLE
IV

 

Representations
and Warranties of Buyer

 

Buyer hereby
represents and warrants to Sellers as follows, except as otherwise set forth on
the Schedules hereto: 

 

Section
4.1.  Organization,
Standing and Power. Buyer is a
limited liability company duly organized, validly existing and in good standing
under the laws of the States of Nevada, with full corporate power and corporate
authority to (a) own, lease and operate its properties, (b) carry on
its business as currently conducted by it, and (c) execute, deliver and
perform under this Agreement, the Ancillary Agreements and each other agreement
and instrument to be executed and delivered by Buyer pursuant
hereto. 

 

Section
4.2.  Authority. The execution and
delivery by Buyer of this Agreement, the Ancillary Agreements and of all of the
other agreements to be executed and delivered by Buyer pursuant hereto, the
performance by Buyer of its obligations hereunder and thereunder, and the
consummation of the 

 

- 23 -

transactions
contemplated hereby and thereby, have been duly and validly authorized by all
necessary limited liability company action on the part of Buyer (including, but
not limited to, resolutions adopted by the Managing Member of Buyer), and Buyer
has all necessary power and authority with respect thereto, including under the
laws of the State of Nevada governing limited liability companies. This
Agreement is, and when executed and delivered by each Seller will be, the valid
and binding obligations of the Buyer, enforceable against Buyer in accordance
with its terms, except as the same may be limited by bankruptcy, insolvency,
reorganization, moratorium or other laws affecting the rights of creditors
generally and subject to the rules of law governing (and all limitations on)
specific performance, injunctive relief and other equitable
remedies.

 

Section
4.3.  Noncontravention. Neither the
execution and delivery by Buyer of this Agreement or of any Ancillary Agreement
to be executed and delivered by Buyer, nor the consummation of any of the
transactions contemplated hereby or thereby, nor the performance by Buyer of any
of its obligations hereunder or thereunder, will (a) conflict with or
result in a breach of or a default under any provision of its Articles of
Organization, Operating Agreement, or other charter documents, as amended to
date, (b) give rise to a default, or any right of termination, cancellation
or acceleration, or otherwise be in conflict with or result in a loss of
contractual benefits, under any note, bond, mortgage, indenture, license,
agreement or other instrument or obligation to which Buyer is a party or by
which its assets may be bound or affected, or require any consent, approval or
notice under the terms of any such document or instrument, or (c) violate
any order, writ, injunction, decree, law, statute, rule or regulation of any
court or governmental authority which is applicable to Buyer, except, in the
cases of clauses (b) and (c) above, as would not have a material adverse effect
on the operations, business, properties, assets, liabilities, results of
operations or financial condition of Buyer.

 

ARTICLE
V

 

Covenants of
Sellers and Buyer

 

Section
5.1.  Investigation of
Business; Access to Properties and Records. 

 

(a)  After the date
hereof and prior to the Closing, Sellers shall afford to Buyer and its
authorized representatives reasonable access to all offices and properties of
Sellers and the International Subsidiaries, and to the Weider Books and Records,
during normal business hours and upon reasonable advance written request,
subject to compliance with Applicable Laws and contractual obligations of
Sellers or any of their Affiliates; provided, however, that such
investigation shall be conducted in such a manner as to minimize interference
with the operation of any business of Sellers or any of their Affiliates. If, as
of the date hereof or at any time thereafter prior to the Closing Date, Buyer
becomes aware of or discovers any material breach of any representation or
warranty contained in this Agreement or any circumstance or condition that upon
Closing would likely constitute such a breach, Buyer shall promptly so notify
Sellers.

 

(b)  All proprietary
information and any other information provided to Buyer or its representatives
pursuant to this Agreement shall be held by Buyer and its representatives as
confidential and shall not be used for any reason or purpose other than to
evaluate and consummate the transactions 

 

- 24 -

contemplated by
this Agreement and shall not be disclosed to any other person except upon the
prior written consent of Sellers or to an authorized agent, consultant, advisor
or other representative of Buyer who require such information for the purpose of
evaluating the transaction contemplated by this Agreement. If this Agreement is,
for any reason, terminated prior to the Closing, the terms of this Section
5.1(b) shall continue in
full force and effect in accordance with its terms.

 

(c)  Prior to the
Closing, Buyer and Sellers shall cooperate in good faith to identify all
materials that are or comprise Weider Books and Records. Except as otherwise
provided by law or regulation, Buyer agrees: (i) that Sellers shall be
permitted to retain copies of the Weider Books and Records, or originals to the
extent Sellers provide Buyer with copies of the same; (ii) to hold the
Weider Books and Records transferred to Buyer on the Closing Date and not to
destroy or dispose of any thereof for a period of three (3) years
following the Closing Date or such longer time as may be required by Applicable
Law; and (iii) at any time and from time to time following the Closing Date
to afford Sellers, their accountants and counsel, during normal business hours,
upon at least five (5) Business Days’ prior notice, full access to
such Weider Books and Records (including the right to copy such materials at
Sellers’ expense) to the extent that such access may be reasonably requested
(without unreasonably disrupting the personnel and operations of the Weider
Branded Business) for any legitimate purpose.

 

Section
5.2.  Agreement to
Cooperate. Subject to the
terms and conditions of this Agreement and Applicable Law, each of Buyer and
Sellers shall use commercially reasonable efforts to take, or cause to be taken,
all action and do, or cause to be done, all things necessary, proper or
advisable under Applicable Laws to satisfy their respective “Conditions to
Closing” set forth in Articles VII and VIII and to consummate and make effective
the transactions contemplated by this Agreement, including, without limitation
(i) to obtain all necessary or appropriate waivers, Consents and approvals
of third persons and Governmental Authorities, (ii) to effect all necessary
registrations, filings and submissions with any Governmental Authorities, and
(iii) to lift or dissolve any order, injunction or other legal bar to
consummate the transactions contemplated by this Agreement (and, in such case,
to proceed with the consummation of those transactions as expeditiously as
reasonably possible), including through all possible appeals.

 

Section
5.3.  Further
Assurances; Contract Audits. Buyer and Sellers
shall execute such documents and other papers and take such further actions as
the other party may reasonably request in order to carry out the provisions
hereof and the transactions contemplated hereby. The parties shall use their
respective reasonable best efforts to cooperate with the other party in
connection with any litigation relating to the Weider Branded Business,
including providing reasonable access to books and records and current
employees; provided that, in no event shall
either party be required to make any expenditure of money in connection
therewith. 

 

Section
5.4.  No
Disclosure.

 

(a)  Each of Sellers and
Buyer agree that it shall not make any public announcement or issue any press
release in connection with the transactions contemplated hereby, except
(i) as provided in Section 5.4(b) or (ii) if any
of Buyer or Sellers (A) is ordered to make such disclosure by a court of
competent jurisdiction or (B) is advised by legal counsel that such disclosure
is advisable under Applicable Laws, in which case the party making the
disclosure shall, to the extent reasonably practicable, inform the other party
as to the timing and contents of such disclosure prior to making such
disclosure.

 

- 25 -

 

 

(b)  To the extent
permitted by Applicable Laws, Buyer and Sellers shall agree on the content and
timing of each of their respective initial press releases in connection with the
transactions contemplated hereby.

 

Section
5.5.  Intangibles.

 

(a)  Sellers shall
assign, or cause to be assigned, effective as of the Effective Date, to Buyer
all of Sellers’ rights, title and interest in and to the Intangibles. Buyer
shall be responsible for the preparation, submission and cost of all
applications, notices, recordations, registrations and other filings with
Governmental Authorities necessary to assign to Buyer all of Sellers’ and the
International Subsidiaries’ rights, title and interest in and to the
Intangibles; provided that, Sellers shall
provide Buyer with commercially reasonable assistance in connection
therewith.

 

(b)  Sellers covenant
and agree that, upon the request of Buyer, Sellers will execute and deliver any
and all papers, execute all documents and instruments and do all lawful acts as
may be reasonably necessary to perfect Buyer’s right and title in and to the
Intangibles. Buyer shall bear all costs with respect to the preparation of all
papers, documents and instruments and all costs associated with the assignment
to Buyer of the Intangibles.

 

Section
5.6.  Intercompany
Arrangements and Accounts. 

 

(a)  Sellers and Buyer
acknowledge and agree that, immediately prior to the Closing, other than the
Ancillary Agreements, and except for the intercompany arrangements, promissory
notes and/or accounts set forth on Schedule 5.6(a) (if any) or as
otherwise provided herein, each intercompany contract, lease, license,
commitment or other arrangement relating to the Weider Branded Business and
involving Sellers, any of the International Subsidiaries or any of their
respective Affiliates, except for amounts owing between the International
Subsidiaries, shall be terminated and be of no further force or effect,
notwithstanding any terms thereof to the contrary.

 

(b)  On the Closing
Date, Buyers shall pay to Sellers any and all outstanding amounts due on each of
the matters set forth on Schedule
5.6(b).

 

Section
5.7.  Insurance. Sellers shall use
commercially reasonable efforts to keep, or cause to be kept, in full force and
effect through the close of business on the Closing Date, all insurance policies
presently maintained with respect to the Weider Branded Business and the Weider
Assets, or suitable replacements therefor. Sellers shall notify Buyer within
two (2) Business Days if any such insurance policy terminates or is no
longer in full force and effect.

 

Section
5.8.  Collection of
Receivables; Forwarding of Payments. From and after
the Closing, Buyer shall have the right and authority to collect for its own
account all accounts receivable and other related items that are included in the
Weider Domestic Assets.  From and after the Closing Date and 

 

- 26 -

subject to the
Ancillary Agreements, Sellers shall, and shall cause their Affiliates to,
promptly deliver to Buyer any cash or other property received directly or
indirectly by it (or them) with respect to such accounts receivable and such
other related items. Buyer shall, and shall cause its Affiliates to, promptly
deliver to Sellers any cash or other property received directly or indirectly by
it (or them) with respect to any Excluded Assets.

 

Section
5.9.  Assignment of
Export Rights. Notwithstanding
anything in this Agreement to the contrary, prior to the Closing Date, WNG
Canada shall execute and deliver to Sellers an instrument of assignment granting
Sellers all of its rights to export non-Weider® brand products under that
certain letter agreement between WNG Canada and Weider Sports Equipment Co.,
Ltd. dated as of December 5, 1996.

 

Section
5.10.  Facilities
Inspection. On a going
forward basis, for so long as a Seller manufactures any material amounts of
Products for Buyer in connection with the Weider Branded Business, Sellers agree
to allow Buyer and/or its designees or licensees to inspect, during business
hours and on reasonable advance notice, only those portions of any facilities of
Seller where such Products are manufactured; provided however, that Buyer shall
not be allowed to exercise its inspection rights under this Section
5.10 more than once per
every three months.

 

Section
5.11.  Covenant Not to
Compete; Nonsolicitation.

 

(a)  As a further
inducement to Sellers to sell the Weider Assets, Buyer agrees that for the
period from the Closing Date until the expiration of eighteen (18) months from
the Closing Date (the “Restricted Period”), Buyer and its Affiliates (other than
through WNI and its direct or indirect subsidiaries) will not, without the prior
written consent of WNI (which consent may be withheld by WNI in its sole and
absolute discretion), directly or indirectly engage in any business or activity
or render services to any person, corporation or entity, whether by itself or as
a consultant, partner, principal, agent, stockholder (other than as a 1% or less
stockholder of a publicly-traded corporation) or in any other corporate or
representative capacity, that competes in any manner: (i) in the joint care or
musculo-skeletal health category for dietary or nutritional supplements or
homeopathic products throughout the world or (ii) with any product or product
lines sold as of the date hereof under Seller’s Schiff brand within the United
States. Notwithstanding any of the foregoing, Sellers specifically agree that,
outside of the United States, Buyer and/or its Affiliates have the right to be a
manufacturer/supplier of unaffiliated third-party private labeled (not Weider
branded) dietary or nutritional supplements or homeopathic products in the
joint-care and/or musculo-skeletal health category. 

(b)  During the
Restricted Period, Buyer agrees that Buyer and its Affiliates will not, without
the prior written consent of WNI (which consent may be withheld by WNI in its
sole and absolute discretion), directly or indirectly solicit for employment (or
directly or indirectly cause or seek to cause to leave the employ of Sellers or
their direct or indirect subsidiaries) any employee of Sellers or their direct
or indirect subsidiaries; provided, however, that Buyer shall not be prevented
from employing any employee of Sellers or their direct or indirect subsidiaries
who (i) contacts the Buyer on his or her own initiative without any direct or
indirect solicitation or encouragement by the Buyer (other than general
advertising or general recruitment efforts
not targeted at selected employees), (ii) has been terminated by Sellers or
their direct or indirect subsidiaries prior to commencement of employment
discussions between Buyer and such employee or (iii) has voluntarily left the
employ of Sellers or their direct or indirect subsidiaries prior to commencement
of employment discussions between Buyer and such employee .

 

- 27 -

 

(c)  It is expressly
understood and agreed that although Sellers and Buyer consider the restrictions
contained in this Section 5.11 to be reasonable in the context in which made, if
a final judicial determination is made that the time, territory, scope or any
other restriction contained in this Section 5.11 is unreasonable or otherwise
unenforceable, neither this Agreement nor the provisions of this Section 5.11
shall be rendered void, but shall be deemed amended to apply as to such maximum
scope, time and territory and to such other extent as such court may judicially
determine or indicate to be reasonable, and as so modified, the restrictions
contained in this Section 5.11 shall be binding and
enforceable.

 

Section
5.12.  Ownership of
International Subsidiary Stock. In the event that
the International Subsidiary Stock is not transferred to Buyer on the Closing
Date, Sellers shall continue to hold the International Subsidiary Stock as
bailee for Buyer and, upon Buyer's written instructions, Sellers shall use their
commercially reasonable efforts to promptly transfer the International
Subsidiary Stock to Buyer and deliver to Buyer the stock certificates
representing the International Subsidiary Stock.

 

ARTICLE
VI

 

Tax
Matters

 

Section
6.1.  Tax
Representations. Except as set
forth on the Schedules hereto, (a) none of the Weider Assets is a lease
made pursuant to Section 168(f)(8) of the Code; and (b) as of the
date hereof, no liens for material Taxes have been filed with respect to the
Weider Assets.

 

Section
6.2.  Allocation. Buyer and Sellers
agree to act in accordance with the allocations of the consideration paid for
the Weider Branded Business that are set forth in Schedule 6.2 in any relevant
Tax Returns or similar filings and to refrain from taking any Tax position
inconsistent with such allocations. Buyer and Sellers agree to act in accordance
with the allocations set forth in Schedule 6.2 in any relevant
Tax Returns or similar filings and to refrain from taking any Tax position
inconsistent with such allocations. Buyer and Sellers shall each be responsible
for the preparation of their own Section 1060 Statements and Forms in
accordance with applicable Tax Laws. Buyer and Sellers shall each execute and
deliver to each other such statements and forms as are reasonably requested,
which statements and forms shall be consistent with such Allocation
Agreement.

 

Section
6.3.  Tax Obligations
of Sellers. Sellers shall be
liable for, and shall promptly pay when due any and all Taxes for any
Pre-Effective Tax Period, other than non-U.S. income taxes, due and payable by
Sellers with respect to the Weider Branded Business (“Excluded
Taxes”). 

 

- 28 -

 

Section
6.4.  Tax Obligations
of Buyer. Buyer shall be
liable for, and shall promptly pay when due, any and all Taxes (including
non-U.S. income taxes) other than Excluded Taxes.

 

Section
6.5.  Transfer Taxes;
Apportionment of Taxes. 

 

(a)  Buyer and Sellers
shall each pay 50% of any sales, transfer, documentary, use, filing, recording
and similar Taxes and fees, whether levied on Buyer, Sellers or any of their
respective Affiliates, resulting from the transactions contemplated by this
Agreement. 

 

(b)  Any Taxes other
than Income Taxes relating to a Straddle Period shall be apportioned between
Buyer and Sellers based on the number of days during the portion of the
assessment period occurring on and before the Effective Date, and the number of
days during such period occurring after the Effective Date and for purposes of
Sections
6.3, 6.4 and 6.6 and the last
sentence of this Section 6.5(b) each portion
of such period shall be deemed to be a taxable period (whether or not it is, in
fact, a taxable period). To the extent estimated Taxes have been paid prior to
the Effective Date with respect to a Straddle Period, Sellers’ liability with
respect thereto shall be reduced by that amount; provided that if such
payment or accrual of Taxes exceeds Sellers’ liability as calculated pursuant to
this Section 6.5(b), Buyer shall
promptly pay Sellers the amount of such excess. At least forty-five (45)
days prior to the due date of any return for the Straddle Period that is due
after the Effective Date, Buyer shall allow Sellers to review the Straddle
Period return and related work papers for the purpose of determining the amount
of Taxes due from, or due to, Sellers. Any dispute between Buyer and Sellers
with respect to this Section 6.5(b) shall be
resolved by neutral accountants mutually selected by Buyer and Sellers. Buyer
agrees to file all Straddle Period Tax Returns that are due after the Effective
Date in an accurate and timely manner.

 

Section
6.6.  Refunds and
Credits. 

 

(a)  Sellers shall be
entitled to any refunds or credits of, against or attributable to Taxes with
respect to the Weider Branded Business attributable to or arising in
Pre-Effective Tax Periods.

 

(b)  Buyer shall be
entitled to any refunds or credits of, against or attributable to Taxes with
respect to the Weider Branded Business attributable to or arising in
Post-Effective Tax Periods beginning after the Effective Date.

 

(c)  Buyer shall
promptly forward to Sellers or reimburse Sellers for any refunds or credits due
Sellers (pursuant to the terms of this Article VI) within fifteen (15) days
after receipt thereof, and Sellers shall promptly forward to Buyer (pursuant to
the terms of this Article VI) or reimburse Buyer for any refunds or credits due
Buyer within fifteen (15) days after receipt thereof.

 

- 29 -

 

Section
6.7.  Cooperation and
Exchange of Information. 

 

(a)  As soon as
practicable, but in any event within thirty (30) days after Sellers’
request, from and after the Effective Date, Buyer shall provide Sellers with
such cooperation as reasonably requested by Sellers pertaining to any Taxes
relating to any period prior to the Effective Date and shall deliver to Sellers
such information and data concerning the pre-Effective operations of the Weider
Branded Business and make available such knowledgeable Weider Employees as
Sellers may request, including providing the information and data required by
Sellers’ customary tax and accounting questionnaires, in order to enable Sellers
to complete and file all Tax Returns which it may be required to file with
respect to the Weider Branded Business through the Effective Date or to respond
to audits by any domestic or foreign taxing authorities with respect to such
operations and to otherwise enable Sellers to satisfy its internal accounting,
tax and other legitimate requirements. Such cooperation and information shall
include provision of powers of attorney for the purpose of signing Tax Returns
and defending audits and providing copies of all relevant Tax Returns, together
with accompanying schedules and related workpapers, documents relating to
rulings or other determinations by any domestic or foreign taxing authority and
records concerning the ownership and tax basis of property, which Buyer may
possess. Buyer shall make its employees and facilities reasonably available on a
mutually convenient basis not to unreasonably interfere with normal business
operations to provide explanation of any documents or information provided
hereunder.

 

(b)  For a period of
ten (10) years after the Effective Date or such longer period as may
be required by law, Buyer shall retain, maintain in an orderly fashion and not
destroy or dispose of any books or records (including computer files) that
pertain to the Weider Branded Business and that are directly related to the Tax
Returns. Thereafter, Buyer shall not knowingly destroy or dispose of any such
books or records unless it first offers such books and records to Sellers in
writing and Sellers fail to accept such offer within sixty (60) days of its
being made. If Sellers accept such offer, they shall remove the material from
Buyer’s premises at its own expense. This Section 6.7 shall not be
construed to limit Buyer’s obligations under Sections 5.1(a) and
5.1(c). 

 

(c)  Buyer and Sellers
and their respective Affiliates shall cooperate in the preparation of all Tax
Returns relating in whole or in part to taxable periods ending on, before or
including the Effective Date that are required to be filed after the Effective
Date. 

 

Section
6.8.  Tax
Contests. 

 

(a)  If a claim shall be
made by any taxing authority which, if successful, would result in a liability
for Taxes for which Sellers may be liable pursuant to Section 6.3, or if an audit is
commenced by any taxing authority with respect to any Tax that could give rise
to such a tax claim (any such claim or audit, a “Tax
Claim”), Buyer shall
promptly notify Sellers in writing of such Tax Claim, as the case may be. If
notice of the Tax Claim is not given to Sellers within a sufficient period of
time or in reasonable detail to apprise Sellers of the nature of the tax (in
each instance taking into account the facts and circumstances with respect to
such Tax Claim), Sellers
shall not be liable to Buyer to the extent that Sellers’ position is prejudiced
as a result thereof. 

 

- 30 -

 

(b)  Sellers shall be
entitled to control all audits and other proceedings (including as to selection
of counsel and decisions regarding settlement) with respect to a Tax Claim.
Sellers, in their sole option, may pursue or forego any and all administrative
appeals, proceedings, hearings and conferences with the taxing authority with
respect to any Tax Claim and may, in their sole discretion, either pay the Tax
claimed and sue for a refund where applicable law permits such refund suits or
may contest the Tax Claim in any permissible manner, and may prosecute such
contest to a determination in any court or settle such Tax Claim in any manner
as Sellers may determine in their sole discretion. Buyer agrees to provide
Sellers with any authorizations, powers of attorney or other documentation as
may be reasonably necessary to allow Sellers to pursue all such actions
permitted by this Section 6.8.

 

(c)  Notwithstanding
Section 6.8(b), if a Tax Claim
includes or could reasonably be expected to include both a claim for Taxes that
are Excluded Taxes and a claim for Taxes that are Weider Liabilities, and such
claim for Taxes that are Excluded Taxes is not separable from such claim for
Taxes that are Weider Liabilities, the Sellers (if the claim for Taxes that are
Excluded Taxes exceeds or reasonably could be expected to exceed in amount the
claim for Taxes that are Weider Liabilities), or otherwise the Buyer (Sellers or
Buyer, as the case may be, the “Controlling
Party”), shall be
entitled to control the defense of such Tax Claim (such Tax Claim, a
“Mixed Tax
Claim”). In such case,
the other party (the “Non-Controlling
Party”) shall be
entitled to participate fully (at the Non-Controlling Party’s sole expense) in
the conduct of such Mixed Tax Claim and the Controlling Party shall not settle
such Mixed Tax Claim without the consent of such Non-Controlling Party (which
consent shall not be unreasonably withheld). The costs and expenses of
conducting the defense of such Mixed Tax Claim shall be reasonably apportioned
based on the relative amounts of the claim for Taxes that are Excluded Taxes and
the claim for Taxes that are Weider Liabilities. 

 

 

ARTICLE
VII

 

Conditions to
Buyer’s Obligation to Close

 

Buyer’s obligation
to consummate the transactions contemplated hereby shall be subject to the
satisfaction on or prior to the Closing Date, or waiver by Buyer, of all of the
following conditions: 

 

Section
7.1.  Representations,
Warranties and Covenants of Sellers. The
representations and warranties of Sellers contained in this Agreement shall be
true and correct on and as of the Closing Date with the same effect as though
such representations and warranties had been made on and as of such date (except
for representations and warranties that speak as of a specific date or time
other than the Closing Date which need only be true and correct as of such date
or time), except for such failures to be true and correct (without giving effect
to any qualification in such representations and warranties relating to Material
Adverse Effect or materiality) that would, individually or in the aggregate,
reasonably be expected to not result in a Material Adverse Effect. The covenants
and agreements of Sellers to be performed on or before the Closing Date in
accordance with this Agreement shall have been duly performed in all

 

- 31 -

material respects.
Each Seller shall have delivered to Buyer a certificate dated the Closing Date
and signed by an authorized officer of such Seller confirming the
foregoing.

 

Section
7.2.  No
Order. No Governmental
Authority, nor any foreign, federal or state court, of competent jurisdiction
shall have enacted, issued, enforced or entered any statute, rule, regulation,
executive order, injunction, decree, judgment or other order, in any case which
is in effect and which restrains or prohibits the consummation of the
transactions contemplated by this Agreement.

 

Section
7.3.  Managing Member
Authorization. The Managing
Member of Buyer shall have approved this Agreement and all of the transactions
contemplated hereby.

 

Section
7.4.  Special
Committee Authorization. The Special
Committee shall have recommended to the Board of Directors that this Agreement
and all of the transactions contemplated hereby be approved.

 

Section
7.5.  Deliveries. Sellers shall
have delivered to Buyer all of the deliveries required to be made by Sellers
pursuant to Section 2.7
hereof.

 

Section
7.6.  Litigation. No order of any
court or administrative agency shall be in effect which restrains or prohibits
the transactions contemplated hereby, and no claim, suit, action, inquiry,
investigation or proceeding in which it will be, or it is, sought to restrain,
prohibit or change the terms of or obtain damages or other relief in connection
with this Agreement, shall have been instituted or threatened by any person or
entity, and which, in the reasonable judgment of Buyer after receiving the
written advice of its legal counsel (based on the likelihood of success and
material consequences of such claim, suit, action, inquiry or
proceeding), makes it unlawful
or commercially impossible for Buyer to proceed with the consummation of such
transactions or would have a Material Adverse Effect on the Weider Branded
Business.

 

Section
7.7.  Consents and
Approvals. All Consents,
waivers, approvals, licenses and authorizations by third parties and
Governmental Authorities (and all amendments or modifications to existing
agreements with third parties) required as a precondition to the performance by
Sellers of their respective obligations hereunder and under any agreement
delivered pursuant hereto, shall have been duly obtained and shall be in full
force and effect.

 

Section
7.8.  No
Liens. Seller shall have
executed and delivered such deeds, bills of sale, assignments and other
instruments of transfer and conveyance, certificates of title and other
documents as shall be reasonably required by Buyer for the transfer to Buyer of
all of Sellers’ right, title, and interest to and in the Domestic Assets and the
International Subsidiary Stock, free and clear of any material Liens or shall
have delivered, with such instruments and documents, financing statement
releases or termination statements with respect to any security interests
constituting material Liens on the International Subsidiary Stock.

 

Section
7.9.  Date of
Consummation. The transactions
contemplated herein shall have been consummated on or prior to April 1, 2005, or
such later date as the parties shall agree by a written instrument signed by all
of them.

 

- 32 -

 

Notwithstanding
anything to the contrary in this Agreement, Buyer may not rely on the failure of
any condition set forth in this Article VII to be satisfied if such failure was
caused by Buyer’s failure to use its commercially reasonable efforts pursuant to
Section 5.2.

 

 

ARTICLE
VIII

 

Conditions to
Sellers’ Obligation to Close

 

Sellers’ obligation
to consummate the sale of the Weider Assets and the transfer to Buyer of the
Weider Liabilities contemplated hereby is subject to the satisfaction on or
prior to the Closing Date, or waiver by Sellers, of all of the following
conditions:

 

Section
8.1.  Representations,
Warranties and Covenants of Buyer. The
representations and warranties of Buyer contained in this Agreement shall be
true and correct on and as of the Closing Date with the same effect as though
such representations and warranties had been made on and as of such date (except
for representations and warranties that speak as of a specific date or time
other than the Closing Date, which need only be true and correct as of such date
or time) except for such failures to be true and correct (without giving effect
to any qualification in such representations and warranties relating to Material
Adverse Effect or materiality) that would, individually or in the aggregate,
reasonably be expected to not result in a Material Adverse Effect on the ability
of Buyer to perform its obligations hereunder or consummate the transactions
contemplated hereby. The covenants and agreements of Buyer to be performed on or
before the Closing Date in accordance with this Agreement shall have been duly
performed in all material respects. Buyer shall have delivered to Sellers a
certificate dated the Closing Date and signed by an authorized officer of Buyer
confirming the foregoing.

 

Section
8.2.  No
Order. No Governmental
Authority, nor any foreign, federal or state court, of competent jurisdiction
shall have enacted, issued, enforced or entered any statute, rule, regulation,
executive order, injunction, decree, judgment or other order, in any case which
is in effect and which restrains or prohibits the consummation of the
transactions contemplated by this Agreement. 

 

Section
8.3.  Board
Authorization. The Board of
Directors of each Seller shall have approved this Agreement and all of the
transactions contemplated hereby.

 

Section
8.4.  Special
Committee Authorization. The Special
Committee shall have recommended to the Board of Directors that this Agreement
and all of the transactions contemplated hereby be approved.

 

Section
8.5.  Fairness
Opinion. An independent
financial advisor retained by the Special Committee shall have rendered a
fairness opinion in form and substance satisfactory to WNI (the “Fairness
Opinion”).

 

 

- 33 -

 

 

Section
8.6.  Resignation of
Richard Blair. Richard Blair
shall have resigned from the position of Executive Vice President of each of the
Sellers as well as from any and all other positions or offices he holds with
respect to each of the Sellers at the Effective Date.

 

Section
8.7.  Deliveries. Buyer shall have
delivered to Sellers all of the deliveries required to be made by Buyer pursuant
to Section 2.8
hereof

 

Section
8.8.  Litigation. No order of any
court or administrative agency shall be in effect which restrains or prohibits
the transactions contemplated hereby, and no claim, suit, action, inquiry,
investigation or proceeding in which it will be, or it is, sought to restrain,
prohibit or change the terms of or obtain damages or other relief in connection
with this Agreement or any of the transactions contemplated hereby, shall have
been instituted or threatened by any person or entity, and which, in the
reasonable judgment of Sellers after receiving the written advice of its legal
counsel (based on the likelihood of success and material consequences of such
claim, suit, action, inquiry or proceeding), makes it inadvisable to proceed
with the consummation of such transactions.

 

Section
8.9.  Consents and
Approvals. All Consents,
waivers, approvals, licenses and authorizations by third parties and
governmental and administrative authorities (and all amendments and
modifications to existing agreements with third parties) required as a
precondition to the performance by Buyer or Sellers of any of their respective
obligations hereunder and under any agreement delivered pursuant hereto, shall
have been duly obtained and shall be in full force and effect.

 

Section
8.10.  Date of
Consummation. The transactions
contemplated hereby shall have been consummated on or prior to April 1, 2005, or
such later date as the parties shall agree by a written instrument signed by all
of them.

 

Notwithstanding
anything to the contrary in this Agreement, Sellers may not rely on the failure
of any condition set forth in Article VIII to be satisfied if such failure was
caused by Sellers’ failure to use its commercially reasonable efforts pursuant
to Section 5.2.

 

 

ARTICLE
IX

 

Termination

 

Section
9.1.  Termination. Subject to the
terms of Section 9.2 this Agreement may
be terminated at any time prior to the Closing by:

 

(a)  the mutual written
consent of Sellers and Buyer; 

 

(b)  either Sellers or
Buyer if any injunction, restraining order or decree of any nature of any court
or Governmental Authority shall restrain or prohibit the consummation of the
transactions contemplated by this Agreement, and such injunction, order or
decree shall become final and nonappealable and shall not have been entered into
at the request of the terminating party;

 

- 34 -

 

(c)  Sellers if Sellers
shall have received a bona fide offer made by a third party to enter into an
acquisition transaction involving the Weider Assets or the Weider Branded
Business which the Special Committee, after consultation with outside legal
counsel and its independent financial advisor, has determined in good faith is
superior to the transaction proposed in this Agreement (a “Superior
Offer”) and that the
failure to accept such Superior Offer would be inconsistent with the fiduciary
duties of the Board of Directors of Sellers to Sellers’ stockholders under
Applicable Law; or

 

(d)  either Sellers or
Buyer if the Closing has not occurred by the close of business on or prior to
the date which is three (3) months from the date of this Agreement,
and the failure to consummate the transactions contemplated by this Agreement on
or before such date shall not have resulted from the failure by the party
seeking termination of this Agreement to fulfill any covenant provided for
herein that was required to be fulfilled prior to Closing.

 

Section
9.2.  Procedure and
Effect of Termination. In the event of
termination of this Agreement by either or both of Sellers and Buyer pursuant to
Section 9.1, written notice
thereof shall forthwith be given by the terminating party to the other party
hereto, and this Agreement shall thereupon terminate and become void and have no
effect, the transactions contemplated hereby shall be abandoned without further
action by the parties hereto, and the parties hereto waive and release any claim
or Action with respect thereto, except that the provisions of Sections
5.1(b) and 10.5 shall survive the
termination of this Agreement; provided,
however, that such
termination shall not relieve any party hereto of any liability for any willful
breach of this Agreement, which breach is not cured within fifteen (15)
Business Days following written notice from the other party specifying, in
reasonable detail, the nature of such breach. 

 

 

ARTICLE
X

 

Miscellaneous

 

Section
10.1.  Counterparts. This Agreement
may be executed in one or more counterparts, all of which shall be considered
one and the same agreement, and shall become effective when one or more
counterparts have been signed by each of the parties and delivered to the other
parties. Copies of executed counterparts transmitted by telecopy shall be
considered original executed counterparts for purposes of this Section 10.1, provided receipt
of copies of such counterparts is confirmed.

 

Section
10.2.  Governing Law;
Jurisdiction; Waiver. This Agreement
and performance hereunder shall be governed by and construed in accordance with
the laws of the State of California without reference
to the choice of law principles thereof. Each of the parties agrees that all
actions or proceedings arising out of or in connection with this Agreement, or
for recognition and enforcement of any judgment arising out of or in connection
with this Agreement, shall be tried and determined exclusively in the state or
federal courts in the State of California, and each of the parties hereby
irrevocably submits with regard to any such action or proceeding for itself and
in respect to its property, generally and unconditionally, to the exclusive
jurisdiction of the aforesaid courts. Each of the parties hereby expressly
waives any right it may have to assert, and agrees not to assert, by way of
motion, as a defense, counterclaim or 

 

- 35 -

otherwise, in any
such action or proceeding: (a) any claim that it is not subject to personal
jurisdiction in the aforesaid courts for any reason; (b) that it or its
property is exempt or immune from jurisdiction of any such court or from any
legal process commenced in such courts; and (c) that (i) any of the
aforesaid courts is an inconvenient or inappropriate forum for such action or
proceeding, (ii) venue is not proper in any of the aforesaid courts and
(iii) this Agreement, or the subject matter hereof, may not be enforced in
or by any of the aforesaid courts.

 

Section
10.3.  Entire
Agreement. This Agreement
(including any and all Schedules, Exhibits and other documents or agreements
attached hereto, all of which are incorporated herein by this reference)
contains the entire agreement between the parties with respect to the subject
matter hereof and there are no agreements, understandings, representations or
warranties between the parties other than those set forth or referred to
herein.

 

Section
10.4.  Expenses. Except as set
forth in this Agreement, whether or not the transactions contemplated by this
Agreement are consummated, all legal and other costs and expenses incurred in
connection with this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such costs and expenses.

 

Section
10.5.  Notices. All notices and
other communications hereunder shall be sufficiently given for all purposes
hereunder if in writing and delivered personally, sent by documented overnight
delivery service or, to the extent receipt is confirmed, facsimile to the
appropriate address or number as set forth below:

 

(a)  if to Sellers,
to:

 

Weider Nutrition
International, Inc.

2002 South 5070
West

Salt Lake City,
Utah 84104

Attention: Joseph
W. Baty, Chief Financial Officer

Fax: (801)
972-6532

with a copy
to:

 

Paul, Hastings,
Janofsky & Walker LLP

515 South Flower
Street

Twenty-Fifth
Floor

Los Angeles, CA
90071

Attention: Robert
A. Miller, Esq.

Fax: (213)
627-0705

with an additional
copy to:

Latham &
Watkins LLP

650 Town Center
Drive

20th
Floor

Costa Mesa, CA
92626

Attention: Charles
K. Ruck, Esq.

Fax: (714)
755-8290

 

- 36 -

(b)  if to Buyer,
to

 

Weider Global
Nutrition, LLC

21100 Erwin
Street

Woodland Hills, CA
91367

Attention: Eric
Weider

Fax:
818.999.6598

 

with a copy to each
of:

 

Bernard J.
Cartoon

21300 Erwin
Street

Woodland Hills, CA
91367

Fax: (818)
999-1541

 

Greenberg Glusker
Fields Claman 

Machtinger &
Kinsella LLP

1900 Avenue of the
Stars, 21st Floor, 

Los Angeles,
California 90067-4590

Attention: Ronald
K. Fujikawa and Mark Dancsecs

Fax: (310)
201-2300

 

or at such other
address and to the attention of such other person as a party may designate by
written notice to the other party; provided, however, that any such
notice shall be deemed given only upon receipt thereof.

 

Section
10.6.  Successors and
Assigns. This Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns; provided, however, that this
Agreement and the rights and obligations hereunder shall not be assignable or
transferable by Buyer or Sellers without the prior written consent of the
non-assigning party and any such attempt to assign this agreement by Buyer or
Sellers without the other party’s prior written consent shall be null and
void. 

 

Section
10.7.  Survival of
Representations. Notwithstanding
any investigation at any time made by or on behalf of any party hereto, all
representations and warranties made by any party in this Agreement or pursuant
hereto shall terminate immediately following the Closing except for the
representations and warranties made in Sections 3.1, 3.2 and 3.11 which shall
survive for twelve (12) months following the Closing and Sections 3.3, 3.6 and
3.16 which shall survive for six (6) months following the Closing. 

 

Section
10.8.  Headings;
Definitions. The
Section and Article headings contained in this Agreement are inserted for
convenience of reference only and will not affect the meaning or interpretation
of this Agreement. All references to Sections or Articles contained

 

- 37 -

herein mean
Sections or Articles of this Agreement unless otherwise stated. All capitalized
terms defined herein are equally applicable to both the singular and plural
forms of such terms.

 

Section
10.9.  Amendments and
Waivers. This Agreement
may not be modified or amended except by an instrument or instruments in writing
signed by each of the parties hereto. Any party hereto may, only by an
instrument in writing, waive compliance by the other parties hereto with any
term or provision of this Agreement on the part of such other party hereto to be
performed or complied with. The waiver by any party hereto of a breach of any
term or provision of this Agreement shall not be construed as a waiver of any
subsequent breach.

 

Section
10.10.   Interpretation. For the purposes
of this Agreement, (i) unless otherwise specified, “dollars” shall mean
United States dollars, (ii) a “subsidiary” of a corporation means any
corporation more than 50% of whose outstanding voting securities are directly or
indirectly owned by such other corporation, (iii) a “person” shall mean an
individual, a partnership, a joint venture, a corporation, a trust, an
unincorporated organization and a government or any department or agency
thereof, and (iv) the words “including” (and words of similar import) shall
mean “including without limitation.” It is understood and agreed that neither
the specification of any dollar amount in the representations and warranties
contained in this Agreement nor the inclusion of any specific item in the
Schedules or Exhibits is intended to imply that such amounts or higher or lower
amounts, or the items so included or other items, are or are not material, and
neither party shall use the fact of the setting of such amounts or the fact of
the inclusion of any such item in the Schedules in any dispute or controversy
between the parties as to whether any obligation, item or matter is or is not
material for purposes of this Agreement.

 

Section
10.11.   Tax Treatment
and Tax Structure. Notwithstanding
anything to the contrary in this Agreement or any other agreement related to the
transactions contemplated by this Agreement to which the parties hereto or any
of their respective Affiliates is a party, each party is permitted to disclose
the “tax treatment” and “tax structure” (as those terms are defined in Treasury
Regulations Section 1.6011-4) of the transactions contemplated by this
Agreement (including all materials of any kind, including opinions and other tax
analyses relating to the tax treatment and tax structure); provided, however,
that such disclosure may not be made until the earlier of (i) the date of
the public announcement of discussions relating to the transactions contemplated
by this Agreement; (ii) the date of the public announcement of the
transactions contemplated by this Agreement; or (iii) the date of this
Agreement.

 

Section
10.12.  Severability. Any provision of
this Agreement which is invalid or unenforceable shall be ineffective to the
extent of such invalidity or unenforceability, without affecting in any way the
remaining provisions hereof.

 

- 38 -

IN WITNESS WHEREOF,
this Agreement has been signed by or on behalf of each of the parties as of the
day first above written.

 

 

“SELLERS”

 

Weider Nutrition
International, Inc.

 

By:_______________________________  

Name:

Title:

 

Weider Nutrition
Group, Inc.

 

By:_______________________________  

Name:

Title:

 

“BUYER”

 

Weider Global
Nutrition, LLC

 

By:Weider Health
and Fitness,

     
a Nevada corporation, its Managing Member

 

                                   
By:_______________________________

 

Its:_______________________________

 

- 39 -

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