Document:

ex10_6.htm

    
      

    

    
      Exhibit
        10.6

      

      MANUFACTURING
        AND SUPPLY AGREEMENT

      

      This
        Manufacturing and Supply Agreement (this “Agreement”) is effective as of
        the 30th day of March, 2007 (the “Effective Date”), by and between
        Baywood International, Inc., a Nevada corporation (“Customer”), and
        Ultimate Formulations, Inc. dba Best formulations, a California corporation
        (“Supplier”).  In consideration of the mutual covenants
        contained herein and for other good and valuable consideration, the receipt
        and
        sufficiency of which are hereby acknowledged, the parties agree as
        follows:

      

      
        	
                1.

              	
                MANUFACTURE
                  OF PRODUCTS; ORDERS;
                  SHIPMENT

              

      

      

      1.1    Manufacture
        of Products.  Supplier agrees to manufacture for, and to
        sell and deliver to, Customer, such number of the products described on Appendix
        A, as the same may be amended from time to time by mutual agreement (the
        “Products”), and having the product specifications for such Products set
        forth on Appendix B, as the same may be amended from time to time by mutual
        agreement (the “Product Specifications”), as Customer may order pursuant
        to this Agreement.  Customer shall have no obligation to order any
        Products.  Supplier shall manufacture, handle, package, label and ship
        the Products in strict conformity with (a) all applicable Product
        Specifications and (b) all applicable laws and regulations.  Subject
        to the terms and conditions of this Agreement, Supplier shall be Customer’s
        exclusive supplier of the Products.

      

      1.2    Purchase
        Orders.  Customer shall order the Products by written
        purchase orders of Customer that shall specify (i) the quantity of the
        Products, (ii) the addresses to which the Products are to be delivered; and
        (iii) the shipment date for the Products.  Supplier shall accept
        all purchase orders that comply with the terms and conditions of this Agreement,
        and use commercially reasonable efforts to accept all other purchase
        orders.  All purchase orders and invoices for Products are subject to
        the terms and conditions of this Agreement, which terms and conditions shall
        supersede any and all conflicting terms and conditions on Customer’s order form
        in effect from time to time.  All orders by Customer shall be subject
        to Supplier's approval and acceptance, and no order shall be binding on Supplier
        until accepted in writing by a duly authorized officer or employee of
        Supplier.

      

      1.3    Shipment.  All
        Products delivered by Supplier shall be suitably packed and labeled for
        shipment. All shipments shall be F.C.A (as defined in Incoterms 2000) Supplier’s
        facilities.  Customer may change the delivery address for the Products
        ordered, at any time prior to shipment of such Products at no additional
        charge,
        provided that Customer shall reimburse Supplier for any additional storage
        or
        freight costs incurred as a result of any such change.  No early
        shipment of Products is permitted without Customer’s consent. Supplier shall
        promptly notify Customer in writing describing any delay in Product
        delivery.  Once approved and accepted, orders may be cancelled in
        whole or in part or deliveries deferred by Customer only with the prior written
        consent of Supplier and only upon such terms as will reimburse Supplier for
        any
        loss in connection therewith.  Customer shall pay a reasonable charge
        for such cancellation or delay which shall cover the expense of any direct
        and
        indirect commitments Supplier has made to any third party, including any
        of its
        suppliers, and further providing a reasonable allowance for overhead and
        profit.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        	
                2.

              	
                PRICE
                  AND PAYMENT; RIGHT TO
                  MANUFACTURE

              

      

      

      2.1    Price
        and Payment.  The unit prices for the Products shall be
        as set forth in the applicable purchase order, and shall be in U.S. dollars,
        inclusive of all costs associated with Supplier’s manufacture, packaging and
        shipment of the Products.  Supplier shall issue invoices to Customer
        no sooner than the shipment date for such Products, and Customer shall pay
        all
        such invoices within forty-five (45) days of receipt of the invoice or the
        applicable Products, whichever is later.  In the event that Supplier’s
        invoices to Customer are not paid when due, Customer agrees to pay an amount
        equal to 1.5% of the invoice(s) total for each month past the due date on
        which
        payment was due.  Customer further agree to pay reasonable attorney’s
        fees and costs incurred in connection with any legal action to collect any
        invoice(s) not paid when due in which Supplier is the successful
        party.

      

      2.2    Right
        of Manufacture.  Subject to the terms of this Section
        2.2, Customer agrees to purchase the Products exclusively from Supplier as
        long
        as Supplier is not in default under this Agreement.  If Customer
        receives an offer from a Qualifying Third-Party (as defined below) to provide
        any of the Products at a per-item cost lower than that currently offered
        by
        Supplier (a “Third Party Offer”), Supplier shall have the right to match
        the terms of such Third Party Offer for a period of ten (10) days from
        Supplier’s receipt of the terms of such Third Party Offer from
        Customer.  In the event Supplier agrees to match the Third Party
        Offer, Customer and Supplier shall enter into an amendment to this Agreement
        to
        conform to the terms of the Third Party Offer, except for such terms which
        are
        less favorable to Customer.  If Supplier does not agree to match the
        Third Party Offer, Customer shall be free to enter into an agreement with
        such
        Qualifying Third Party to purchase the Product or Products in quantities
        and at
        the prices contained in the Third Party Offer and on payment terms no less
        favorable than those in the Third Party Offer, and this Agreement shall remain
        in full force and effect as to any other Products and purchases.  For
        purposes of this Agreement, “Qualifying Third Party” shall mean a contract
        manufacturer registered with the U.S. Food and Drug Administration and holding
        GMP certification.

      

      
        	
                3.

              	
                WARRANTY,
                  SERVICE AND TECHNICAL
                  SUPPORT

              

      

      

      3.1    Products
        Warranty.  Supplier hereby warrants and covenants that
        all Products, and all materials and components incorporated therein which
        are
        sourced or provided by Supplier, and supplied by Supplier under this Agreement
        shall:  (i) conform with all applicable Product Specifications and all
        applicable laws and regulations; (ii) be of good and merchantable quality,
        free
        from defects in materials and workmanship; (iii) be fit for their intended
        purposes; (iv) not be adulterated or misbranded in any way.  All
        Products covered by terms and conditions stated herein shall be subject to
        the
        standard manufacturing and commercial variations and practices of
        Supplier.  Products manufactured by Supplier may have permissible
        variations and deviations as stated in the USP24 and NF19 <1161> which
        states “...each unit shall be not less than 90% and not more than 110% of the
        theoretically calculated weight for each unit.”  Said permissible
        variations and/or deviations shall apply to net and gross weights of goods
        or
        products, and shall also apply to active ingredient
        potencies.  Supplier reserves the right to ship overages and underages
        of weight, length, size, and/or quantity in accordance with Suppliers’s standard
        practices, but not to exceed 10% of Customer’s original amount ordered under
        purchase order.  EXCEPT AS STATED IN THIS AGREEMENT, SUPPLIER IS
        PROVIDING NO OTHER WARRANTIES, WHETHER EXPRESS OR IMPLIED, AND WHETHER STATUTORY
        OR OTHERWISE, WITH RESPECT TO THE PRODUCTS INCLUDING, BUT NOT LIMITED TO,
        ANY
        WARRANTIES ARISING FROM A COURSE OF DEALING OR USAGE OF TRADE.  THIS
        SECTION 3 STATES THE ENTIRE LIABILITY OF SUPPLIER WITH RESPECT TO THE WARRANTY
        GIVEN HEREIN.

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      3.2           Inspection
        Period.  Within thirty (30) days from the date of receipt
        by Customer of any Products (the “Inspection Period”), Customer may
        reject and return to Supplier any Products which fail to meet the applicable
        Product Specifications (“Defective Products”), or all of a given lot of
        Products if the lot contains a statistically
        significant sample of Defective Products as determined by
        the application of the square root of lot size plus one sampling
        rule.  Unless otherwise agreed to in writing by Supplier, the Products
        covered hereunder may be inspected or tested by Customer only at the place
        of
        manufacture or at any qualified third party testing facility or at such other
        place or done in accordance with any reasonable conditions and rules specified
        by Supplier.  Customer further must notify Supplier of any claimed
        rejection of Products so tested by any reseller of Customer within ten (10)
        calendar days after their receipt of such reseller’s claim by
        Customer.  All analytical and/or physical test protocols must adhere
        to standards established by the United States Pharmacoepia 24 (hereinafter
        referred to as “USP24”) or higher, National Formulary 19 (hereinafter referred
        to as “NF19”) or higher and/or another standard which is agreed to in writing by
        Supplier.  Thereafter, Customer shall be deemed to have waived and
        further to be prohibited from asserting any rejection or seeking the return
        of
        any such goods or products.

      

      3.3           Replacement
        of Defective Products by Supplier.  In the case of such
        rejection during the Inspection Period, Supplier shall, at Customer’s option:
        (i) replace the Defective Products with new Products and ship the
        replacement Products to Customer, at Supplier’s expense, as soon as reasonably
        practicable following Supplier’s receipt of the Defective Products; or
        (ii) provide a full refund to Customer for such Defective
        Products.  All replacement Products furnished by Supplier pursuant to
        this Section 3.3 shall be at no charge to Customer, and Supplier shall bear,
        or
        promptly credit or reimburse Customer for, all shipping costs in connection
        therewith.  In addition to the foregoing, Supplier shall, at its sole
        expense, perform and complete a Root Cause Analysis within thirty (30) days
        after such Defective Products are identified.  Upon completion of each
        Root Cause Analysis, Supplier shall promptly implement a corrective action
        plan
        to prevent further Defective Products and shall communicate to Customer,
        in
        writing, the results of the Root Cause Analysis and the corresponding corrective
        action plan.

      

      3.4    Warranty
        Claim Disputes.  If Supplier determines that a Product
        returned, pursuant to Section 3.2 hereof is not a Defective Product, Supplier
        may notify Customer in writing of such determination (a “Warranty Claim
        Dispute”); provided, however, that a Warranty Claim Dispute
        must be received by Customer no later than thirty (30) days after the earlier
        of
        Supplier’s receipt of the returned Product or warranty claim
        report.  Each Warranty Claim Dispute shall contain all information
        necessary for Customer to evaluate its validity.  Warranty Claim
        Disputes containing insufficient information may be rejected by
        Customer.  Within thirty (30) days of receipt of a Warranty Claim
        Dispute, Customer shall evaluate the validity of the Warranty Claim Dispute,
        and
        shall accept or reject the Warranty Claim Dispute by written notice to
        Supplier.  If Customer accepts a Warranty Claim Dispute, Customer
        shall promptly reimburse Supplier for the costs (if any) of the replacements
        and
        related shipping costs incurred by Supplier in connection with the Product
        subject to the Warranty Claims Dispute.  If Customer rejects a
        Warranty Claim Dispute, Customer shall have the right to refer the Warranty
        Claim Dispute to an independent party for testing.  The decision of
        the independent party shall be final and binding.  The cost of testing
        will be borne by the party whose contention is not upheld by the independent
        party.  A Warranty Claim Dispute shall not relieve Supplier of its
        obligations under Sections 3.1 and 3.3 hereof.  The procedures for
        Warranty Claim Disputes shall also apply in the event of a recall by
        Customer.

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      3.5           RMA
        Procedure.  All Defective Products returned to Supplier
        by Customer in accordance with this Agreement shall  include a Return
        Merchandise Authorization Number (a “RMA Number”) on the outside
        packaging of such returned Defective Product.  Supplier shall issue
        RMA Numbers upon request from Customer.  Supplier shall provide
        Customer with a designated telephone number for the purpose of providing
        RMA
        Numbers.

      

      
        	
                4.

              	
                TERM
                  AND TERMINATION This Agreement shall
                  commence on the Effective Date and continue for an initial term
                  of three
                  (3) years.  This Agreement shall automatically renew for two (2)
                  additional one (1) year terms, unless a party provides the other
                  party
                  notice of its intent to terminate this Agreement at least three
                  (3) months
                  prior to the end of the then current term.  Either party may, at
                  its option, terminate this Agreement, if the other party has breached
                  any
                  provision of this Agreement and has failed to cure such breach
                  within
                  thirty (30) days of delivery of written notice describing the
                  breach.  Notwithstanding the foregoing, either party may
                  terminate this Agreement, without opportunity to cure, if the other
                  party
                  files for bankruptcy or similar action or is in breach of its
                  confidentiality obligations hereunder.  Termination of this
                  Agreement, for whatever reason, shall not affect the obligations
                  of either
                  party that exist as of the date of expiration or
                  termination.  Upon termination of this Agreement for any reason
                  other than the default of Supplier, unless Customer purchases all
                  of the
                  Products on order, either finished or in progress, all costs incurred
                  by
                  Supplier with respect to such orders in process which Supplier
                  cannot
                  resell to its other customers (including without limitation shipping
                  and
                  delivery costs, packaging, label design, and cost of raw, work-in-process
                  and finished product with respect to the Product) shall be borne
                  by
                  Customer.

              

      

      

      
        	
                5.

              	
                REPRESENTATIONS
                  AND
                  WARRANTIES  Each
                  party represents and warrants to the other party that (i) it is
                  duly
                  organized and validly existing under the laws of its jurisdiction
                  of
                  incorporation or formation, and has full corporate power and authority
                  to
                  enter into this Agreement and to carry out the provisions hereof
                  and (ii)
                  this Agreement is legally binding upon it, enforceable in accordance
                  with
                  its terms.

              

      

      

      
        	
                6.

              	
                CONFIDENTIALITY

              

      

      

      
        	
                 

              	
                a.

              	
                Confidential
                  Information.  For purposes of this Agreement,
                  “Confidential Information” means any information disclosed by
                  either party to the other party, either directly or indirectly,
                  in
                  writing, orally or by inspection of tangible objects, which is
                  confidential, trade secret or proprietary to the disclosing party
                  or any
                  third party that has furnished it to the disclosing party.  The
                  parties agree during the term of this Agreement and all times thereafter
                  to use the Confidential Information of the disclosing party only
                  for its
                  performance under this Agreement, and to not to use the Confidential
                  Information for any other purpose.  Each party shall take at
                  least the same degree of care that it uses to protect its own most
                  highly
                  confidential and proprietary information of similar nature and
                  importance
                  (but in no event less than reasonable care) to protect the confidentiality
                  of the Confidential Information of the disclosing
                  party.

              

      

      

      
        	
                 

              	
                b.

              	
                Exclusions.  The
                  foregoing obligations in Section 5.1 shall not apply to any
                  Confidential Information to the extent the party receiving such
                  Confidential Information can prove such Confidential
                  Information:  (i) was publicly known prior to the time of
                  disclosure by the disclosing party; (ii) becomes publicly known
                  through no act or omission of the receiving party; (iii) was
                  rightfully known by the receiving party, without restriction, prior
                  to the
                  time of first disclosure by the disclosing party; (iv) was
                  independently developed by the receiving party without the use
                  of the
                  Confidential Information; or (v) was rightfully obtained by receiving
                  party, without restriction, from a third party who has the right
                  to make
                  such disclosure and without breach of any duty of confidentiality
                  to the
                  disclosing party.  In addition, a party receiving Confidential
                  Information may disclose such Confidential Information to the extent
                  such
                  party is required by law to disclose such Confidential
                  Information.

              

      

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      
        	
                7.

              	
                INDEMNIFICATION.
                  Supplier shall indemnify, hold harmless and defend Customer, its
                  successors and assigns, and their respective officers, directors,
                  employees and agents, from any and all claims, losses, liabilities,
                  damages, judgments, penalties, settlements, expenses and costs,
                  including
                  without limitation reasonable attorneys fees, professional fees
                  and court
                  costs brought by third parties arising out of or related to (i)
                  Supplier’s
                  negligence, willful misconduct or omission or breach of this Agreement,
                  and the warranties contained herein,
                  and (ii) the infringement or alleged infringement by any
                  of the
                  Products of the intellectual property rights of a third
                  party.  Customer shall promptly notify Supplier of any
                  claims.  Supplier shall not settle any claims without the prior
                  written approval of Customer, which approval shall not be unreasonably
                  withheld or delayed.  Customer shall have the right, but not the
                  obligation, to participate in the defense of any claim at its sole
                  expense
                  through counsel of its choosing without forfeiting, reducing or
                  otherwise
                  affecting Customer’s right to indemnification
                  hereunder.  Without limiting the generality of the foregoing
                  indemnity, in the event any Product is held to have infringed the
                  intellectual property rights of any third party, or Supplier is
                  prevented
                  from delivering such Product to Customer as a result of a claim
                  of such
                  infringement, then Supplier, as promptly as possible, will either
                  (a) take
                  such action as is necessary to make the Product non-infringing,
                  or (b)
                  substitute a comparable, non-infringing Product acceptable to Customer,
                  failing which Customer shall no longer have any obligation under
                  this
                  Agreement to purchase the infringing Product from
                  Supplier.

              

      

      

      
        	
                8.

              	
                LIMITATION
                  OF LIABILITY.  NEITHER PARTY WILL BE LIABLE
                  FOR SPECIAL, INDIRECT, PUNITIVE, EXEMPLARY, INCIDENTAL OR CONSEQUENTIAL
                  DAMAGES ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT HOWEVER
                  ARISING, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY
                  OF SUCH
                  DAMAGES.  Except for liability arising from Supplier’s breach of
                  its obligations under Section 7(ii), neither party’s liability arising out
                  of or relating to this Agreement shall exceed the aggregate amounts
                  payable to Supplier by Customer under this
                  Agreement.

              

      

      

      
        	
                9.

              	
                TITLE
                  AND OWNERSHIP OF PRODUCTS.  Supplier owns
                  and shall continue to at all times own title to: (i) all formulas,
                  recipes, other proprietary information and specifications, and
                  all
                  intellectual property rights, relating to the Products, (ii) the
                  brand
                  name of the Products (except for those of which are Customer trademarks),
                  and (iii) the label design and all associated intellectual property
                  rights
                  (other than any Customer trademarks).  Supplier may, at any
                  time, sell products with formulas, recipes and specifications similar
                  to
                  or exactly like the Products to other Supplier customers.
                  

              

      

      

      
        	
                10.

              	
                GENERAL
                  PROVISIONS

              

      

      

      
        	
                 

              	
                a.

              	
                Integration
                  / Modification.  This Agreement and the appendices
                  hereto are both a final expression of the parties’ Agreement and a
                  complete and exclusive statement with respect to all of its
                  terms.  This Agreement supersedes all prior and contemporaneous
                  agreements and communications, whether oral, written or otherwise,
                  concerning any and all matters contained herein.  This Agreement
                  may be modified or supplemented only in a writing signed by all
                  parties
                  hereto.

              

      

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

      
        	
                 

              	
                b.

              	
                Relationship
                  Between the Parties.  The relationship of the
                  parties shall be that of independent contractors.  Nothing
                  contained in this Agreement shall be construed to create a partnership,
                  joint venture or agency relationship between Customer and
                  Supplier.

              

      

      

      
        	
                 

              	
                c.

              	
                Insurance.  Supplier
                  shall obtain and keep in force a commercial general liability policy
                  with
                  coverage amounts not less than $2,000,000.  Supplier shall name
                  Customer as an additional insured on such policy or policies of
                  insurance.  Supplier shall, prior to the Effective Date of this
                  Agreement, deliver to Customer and thereafter keep current valid
                  certificates of insurance or copies of insurance binder evidencing
                  the
                  existence and amounts of the required
                  insurance.

              

      

      

      
        	
                 

              	
                d.

              	
                Non-Waiver.  The
                  failure of a party to insist upon strict performance of any provision
                  of
                  this Agreement or to exercise any right arising out of this Agreement
                  shall neither impair that provision or right nor constitute a waiver
                  of
                  that provision or right, in whole or in part, in that instance
                  or in any
                  other instance.

              

      

      

      
        	
                 

              	
                e.

              	
                Remedies.  Except
                  as otherwise expressly provided herein, no remedy in this Agreement
                  is
                  intended to be exclusive, but each shall be cumulative and in addition
                  to
                  any other remedy referred to herein or otherwise available at law,
                  equity
                  or otherwise.

              

      

      

      
        	
                 

              	
                f.

              	
                Assignment.  Customer
                  shall have the right to assign this Agreement without the consent
                  of
                  Supplier.  Supplier may not assign this Agreement without
                  Customer’s consent.  Any assignment, delegation or transfer, or
                  attempt at the same, in violation of the foregoing shall be void
                  and
                  without effect.

              

      

      

      
        	
                 

              	
                g.

              	
                No
                  Third Party Beneficiaries.  This Agreement is
                  neither expressly nor impliedly made for the benefit of any party
                  other
                  than those executing it.

              

      

      

      
        	
                 

              	
                h.

              	
                Severability.  If,
                  for any reason, any part of this Agreement is adjudicated invalid,
                  unenforceable or illegal by a court of competent jurisdiction,
                  such
                  adjudication shall not affect or impair, in whole or in part, the
                  validity, enforceability or legality of any remaining portions
                  of this
                  Agreement.  All remaining portions shall remain in full force
                  and effect as if the original Agreement had been executed without
                  the
                  invalidated, unenforceable or illegal
                  part.

              

      

      

      
        	
                 

              	
                i.

              	
                Notices.  Any
                  notice to be given under this Agreement shall be in writing and
                  shall be
                  presumptively deemed given (i) when personally delivered;
                  (ii) when sent by facsimile, with confirmation of receipt;
                  (iii) one (1) day after having been sent by commercial overnight
                  courier with written verification of receipt; or (iv) five (5) days
                  after having been sent by registered or certified mail, return
                  receipt
                  requested, proper postage prepaid.  All such notices shall be
                  addressed to the receiving party at the address or addresses set
                  forth
                  below or at such other addresses as either party may specify from
                  time to
                  time by written notice in accordance
                  herewith.

              

      

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

       

      
        	
                If
                  to Supplier, notices must be addressed to:

              	 
	 	 
	
                Ultimate
                  Formulations, Inc.

              	 
	
                dba
                  Best Formulations

              	 
	
                17758
                  Rowland Street

              	 
	
                City
                  of Industry, CA 91748

              	 
	
                Fax:
                  (626) 965-0886

              	 
	 	 
	
                If
                  to Customer, notices must be addressed to:

              	
                With
                  a copy to:

              
	 	 
	
                Baywood
                  International, Inc.

              	
                Meltzer,
                  Lippe, Goldstein & Breitstone, LLP

              
	
                14950
                  North 83rd
                  Place, Suite
                  1

              	
                190
                  Willis Avenue

              
	
                Scottsdale,
                  AZ  85260

              	
                Mineola,
                  NY  11501

              
	
                Attention:
                  Neil Reithinger, President & C.E.O.

              	
                Attention:  David
                  I. Schaffer, Esq.

              
	
                Fax:
                  (480) 483-2168

              	
                Fax:  (516)
                  747-0653

              

      

      

      
        	
                 

              	
                j.

              	
                Force
                  Majeure.  Neither party shall be liable for the
                  failure or delay in performance of any obligation under this Agreement
                  by
                  reason of any event beyond such party’s reasonable control, including
                  without limitation Acts of God, fire, flood, earthquake or other
                  natural
                  forces, war, civil unrest, actions or decrees of governmental bodies,
                  accident, casualty, freight
                  embargoes.

              

      

      

      
        	
                 

              	
                k.

              	
                Choice
                  of Law, Forum and Jurisdiction.  THIS AGREEMENT IS
                  MADE WITHIN THE STATE OF CALIFORNIA AND SHALL BE GOVERNED BY AND
                  CONSTRUED
                  IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA WITHOUT
                  REGARD TO
                  ITS CONFLICT OF LAWS PRINCIPLES.  THE PARTIES AGREE THAT THE
                  UNITED NATIONS CONVENTION ON CONTRACTS FOR THE INTERNATIONAL SALE
                  OF GOODS
                  SHALL NOT APPLY TO THIS AGREEMENT.  THE PARTIES HERETO HEREBY
                  IRREVOCABLY AND UNCONDITIONALLY:  (i) AGREE THAT ANY AND
                  ALL ACTIONS, SUITS OR OTHER LEGAL PROCEEDINGS, WHETHER OR NOT ARISING
                  UNDER THIS AGREEMENT AND REGARDLESS OF THE LEGAL THEORY UPON WHICH
                  THE
                  CLAIMS ARE BASED, MAY BE BROUGHT AGAINST THE OTHER PARTY ONLY IN
                  THE
                  COURTS OF THE STATE CALIFORNIA FOR THE COUNTY OF ORANGE OR THE
                  SOUTHERN
                  DIVISION OF THE UNITED STATES DISTRICT COURT FOR THE CENTRAL DISTRICT
                  OF
                  CALIFORNIA, AND CONSENT TO THE EXCLUSIVE JURISDICTION OF SUCH COURTS
                  IN
                  ANY SUCH LEGAL PROCEEDING; (ii) AGREE THAT SERVICE OF PROCESS IN ANY
                  SUCH LEGAL PROCEEDING SHALL BE EFFECTED IN ACCORDANCE WITH THE
                  STATUTES OF
                  CALIFORNIA AND THE UNITED STATES, AS APPROPRIATE; AND (iii) WAIVE ANY
                  OBJECTION EITHER PARTY MAY NOW OR HEREAFTER HAVE TO THE VENUE OF
                  ANY SUCH
                  LEGAL PROCEEDING IN SUCH
                  COURTS.

              

      

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

       

      
        	
                 

              	
                l.

              	
                Jury
                  Waiver.  TO THE EXTENT PERMITTED BY LAW, THE
                  PARTIES HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY
                  IN ANY
                  ACTION, SUIT OR OTHER LEGAL PROCEEDING BETWEEN THEM, WHETHER OR
                  NOT
                  ARISING UNDER THIS AGREEMENT, AND REGARDLESS OF THE LEGAL THEORY
                  UPON
                  WHICH THE CLAIMS ARE BASED.

              

      

      

      
        	
                 

              	
                m.

              	
                Attorney
                  Fees.  In the event any litigation or other
                  proceeding is brought by either party arising out of or relating
                  to this
                  Agreement, the prevailing party in such litigation or other proceeding
                  shall be entitled to recover from the other party all reasonable
                  costs,
                  attorney fees, professional fees and other expenses incurred by
                  such
                  prevailing party in such litigation or
                  proceeding.

              

      

      

      
        	
                 

              	
                n.

              	
                Ambiguities.  Ambiguities
                  and uncertainties in this Agreement, if any, shall not be interpreted
                  against either party, regardless of which party may be deemed to
                  have
                  caused the ambiguity or uncertainty to
                  exist.

              

      

      

      
        	
                 

              	
                o.

              	
                Counterparts.  This
                  Agreement may be executed in one or more counterparts, each of
                  which shall
                  be deemed an original document and all of which together shall
                  be deemed
                  one instrument.

              

      

      

      
        	
                 

              	
                p.

              	
                Further
                  Assurances.  Each party to this Agreement shall, at
                  its own expense, furnish, execute, and deliver all documents and
                  take all
                  actions as may reasonably be required to effect the terms and purposes
                  of
                  this Agreement.

              

      

      

      
        	
                 

              	
                q.

              	
                Survival.  In
                  addition to any term which expressly provides for survival beyond
                  the term
                  hereof, Sections 2.1 (to the extent applicable), 3, 5, 6, 7, 8,
                  10(k) and
                  10(l) shall survive expiration or termination of this
                  Agreement.

              

      

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

      IN
        WITNESS WHEREOF, the Parties, intending to be bound hereby, have executed
        this
        Agreement as of the date first set forth above.

      

      
        	
                Baywood
                  International, Inc.

              	 	
                Ultimate
                  Formulations, Inc.,

                Dba
                  Best Formulations

              
	 	 	 	 	 
	
                By:

              	
                 /s/
                  Neil Reithinger

              	 	
                By:

              	
                /s/
                  Charles Ung

              
	 	 	 	 	 
	
                Name:

              	
                Neil
                  Reithinger

              	 	
                Name:

              	
                Charles
                  Ung

              
	 	 	 	 	 
	
                Title:

              	
                President
                  & C.E.O.

              	 	
                Title:

              	
                President

              

      

      

        
          
            
            

          

          
            9

            
              

            

          

          
            
            

          

        

      

       

      APPENDIX A

      PRODUCTS

      

      
        	 	
                ·

              	
                Acidophilus
                  5-billion capsules

              
	 	
                ·

              	
                Acidophilus
                  500-million capsules

              
	 	
                ·

              	
                Vital
                  Hair tablets

              
	 	
                ·

              	
                Acidophilus
                  chewable tablets

              
	 	
                ·

              	
                MSM
                  1000 mg tablets

              
	 	
                ·

              	
                Glucosamine/Chondroitin
                  tablets

              
	 	
                ·

              	
                Advanced
                  Joint Support tablets

              
	 	
                ·

              	
                Co
                  Q10 100 mg softgels

              
	 	
                ·

              	
                Co
                  Q10 120 mg softgels

              
	 	
                ·

              	
                Co
                  Q10 30 mg softgels

              
	 	
                ·

              	
                Co
                  Q10 60 mg softgels

              
	 	
                ·

              	
                Ginkgo
                  Biloba capsules

              
	 	
                ·

              	
                Cal-Mag-Zinc
                  softgels

              

      

      

        
          
            
            

          

          
            10

            
              

            

          

          
            
            

          

        

      

       

      APPENDIX B

      PRODUCT
        SPECIFICATIONS

      

      See
        Attached Zip File Named LifeTime Product Specs

    

     

     

    11ex10_7.htm

    
      

    

    
      Exhibit
        10.7

      

      REGISTRATION
        RIGHTS AGREEMENT

      

      This
        Registration Rights Agreement (this “Agreement”) is made and entered into
        as of this 30th day of March, 2007 by and among Baywood International, Inc.,
        a
        Nevada corporation (the “Company”), O. Lee Tawes, III (“Tawes”)
        and John Talty (“Talty”), individuals who were issued warrants to
        purchase Common Shares (as defined below) (the “Tawes/Talty Warrants”) in
        connection with the Company’s 10% Notes in an aggregate principal amount not
        less than $1,000,000 or more than $3,000,000 (the “10% Notes), JSH
        Partners (“JSH Partners”), an entity who was issued a warrant (the
“JSH Partners Warrant”) to purchase Common Shares in connection with the
        Company’s 12% 2007 Bridge Note in an aggregate principal amount not to exceed
        $2,000,000 (the “12% 2007 Bridge Note”) and Northeast Securities, Inc.,
        as Attorney-in-Fact for the investors set forth on Schedule A attached hereto,
        who have executed a Subscription Agreement with the Company (the
“Subscription Agreement”) in connection with the offer and sale of Units
        consisting of (i) 5,000 shares of  Convertible Preferred Stock and
        (ii) a warrant to purchase 250,000 Common Shares (the “Investor
        Warrant”).

      

      The
        parties hereby agree as follows:

      

      
        	
                 

              	
                1.

              	
                Certain
                  Definitions.

              

      

      

      As
        used
        in this Agreement, the following terms shall have the following
        meanings:

      

      “Affiliate”
        means, with respect to any person, any other person which directly or indirectly
        controls, is controlled by, or is under common control with, such
        person.

      

      “Business
        Day” means a day, other than a Saturday or Sunday, on which banks in New
        York City are open for the general transaction of business.

      

      “Common
        Shares” means shares of the Company’s common stock, par value $0.001, and
        any securities into which such shares may hereinafter be
        reclassified.

      

      “Convertible
        Preferred Stock” means shares of the Series I 8% Cumulative Convertible
        Preferred Stock, par value $0.001 per share, of the Company.

      

      “Investors”
        means collectively, Tawes, Talty, JSH Partners and the investors set forth
        on
        Schedule 1 attached hereto and made a part hereof or a permitted transferee
        of
        Tawes, Talty, JSH Partners or of any investor set forth on Schedule I attached
        hereto and made a part hereof who is a subsequent holder of any Registrable
        Securities.  The Investors are individually referred to herein as an
“Investor”.

      

      “Prospectus”
        means the prospectus included in any Registration Statement, as amended or
        supplemented by any prospectus supplement, with respect to the terms of the
        offering of any portion of the Registrable Securities covered by such
        Registration Statement and by all other amendments and supplements to the
        prospectus, including post-effective amendments and all material incorporated
        by
        reference or deemed to be incorporated by reference in such prospectus which
        is
        permitted to be so incorporated by reference in accordance with the rules
        and
        regulations of the SEC.

      

      “Register,”
        “registered” and “registration” refer to a registration made by
        preparing and filing a Registration Statement or similar document in compliance
        with the 1933 Act (as defined below), and the declaration or ordering of
        effectiveness of such Registration Statement or document.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      “Registrable
        Securities” means (i) the shares of Convertible Preferred Stock issued to
        the Investors (excluding Tawes, Talty and JSH Partners), (ii) the Investor
        Warrants; (iii) the Common Shares issuable upon any conversion of the
        Convertible Preferred Stock or any exercise of the Investor Warrants; (iv)
        the
        Tawes/Talty Warrants; (v) the Common Shares issuable upon exercise of the
        Tawes/Talty Warrants; (vi) the JSH Partners Warrant; (vii) the Common Shares
        issuable upon exercise of the JSH Partners Warrant; (viii) any other securities
        issued or issuable with respect to or in exchange for Registrable Securities;
        and (ix) any securities issued or issuable with respect to such securities
        by
        way of a stock dividend or stock split or in connection with a combination
        of
        shares, recapitalization, merger, consolidation or other reorganization with
        respect to any of the securities referenced above; provided, that, a security
        shall cease to be a Registrable Security upon (A) a sale pursuant to a
        Registration Statement; or (B) such security becoming eligible for sale by
        an
        Investor pursuant to Rule 144(k) under the 1933 Act.

      

      “Registration
        Statement” means any registration statement of the Company filed under the
        1933 Act that covers the resale of any of the Registrable Securities pursuant
        to
        the provisions of this Agreement, amendments and supplements to such
        Registration Statement, including post-effective amendments, all exhibits
        and
        all material incorporated by reference or deemed to be incorporated by reference
        in such Registration Statement.

      

      “Required
        Investors” means the Investors holding a majority of the Registrable
        Securities.

      

      “SEC”
        means the U.S. Securities and Exchange Commission.

      

      “Warrants”
        means together, the Tawes/Talty Warrants, the JSH Partners Warrant and the
        Investor Warrants.

      

      “Warrant
        Shares” means the Common Shares issuable upon exercise of the
        Warrants.

      

      “1933
        Act” means the Securities Act of 1933, as amended, and the rules and
        regulations promulgated thereunder.

      

      “1934
        Act” means the Securities Exchange Act of 1934, as amended, and the rules
        and regulations promulgated thereunder.

      

      
        	
                 

              	
                2.

              	
                Registration.

              

      

       

      (a)           Registration
        Statements.  The Company shall prepare and file a registration
        statement with respect to the resale of the Registrable Securities with the
        SEC
        within 60 days after the original issuance of the Convertible Preferred Stock
        and Warrants.  Such Registration Statement shall include the plan of
        distribution attached hereto as Exhibit
        A.  Such Registration Statement also shall cover, to the
        extent allowable under the 1933 Act and the rules promulgated thereunder
        (including Rule 416), such indeterminate number of additional Registrable
        Securities resulting from share splits, share dividends or similar transactions
        with respect to the Registrable Securities.  The Registration
        Statement (and each amendment or supplement thereto, and each request for
        acceleration of effectiveness thereof) shall be provided in accordance with
        Section 3(c) to each Investor and its counsel prior to its filing or
        other submission.

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      (b)           Expenses.  The
        Company will pay all expenses associated with such registration, including
        filing and printing fees, the Company’s counsel and accounting fees and
        expenses, costs associated with clearing the Registrable Securities for sale
        under applicable state securities laws, listing fees, blue sky fees, fees
        and
        expenses of one counsel to the Investors designated by the Required Investors
        and the Investors’ reasonable expenses in connection with the registration and
        the expenses of any special audits incident to or required by any such
        registration, but excluding stock transfer taxes, discounts, commissions
        or fees
        of underwriters, selling brokers, dealer managers or similar securities industry
        professionals with respect to the Registrable Securities being
        sold.

      

      
        	
                 

              	
                (c)

              	
                Effectiveness.

              

      

      

      (i)           The
        Company shall use reasonable best efforts to have the Registration Statement
        declared effective within 150 days after the original issuance of the
        Convertible Preferred Stock and Warrants.  The Company shall notify
        the Investors by facsimile or e-mail as promptly as practicable (with a copy
        provided to the Investors by U.S. mail), or by issuing a press release to
        Reuters Economic Services and Bloomberg Business News with one copy e-mailed
        to
        Investors and a second copy provided by US Mail, and in any event, within
        twenty-four (24) hours, after any Registration Statement is declared effective
        and as soon as reasonably practicable shall provide the Investor with copies
        of
        any related Prospectus to be used in connection with the sale or other
        disposition of the securities covered thereby.

      

      (ii)           Notwithstanding
        anything to contrary, for not more than twenty (20) consecutive days or for
        a
        total of not more than forty-five (45) days in any twelve (12) month period
        (provided, however, that no such delay, suspension or withdrawal shall be
        permitted for consecutive twenty-day periods arising out of the same set
        of
        facts, circumstances or transactions), the Company may delay, suspend the
        use
        of, or withdraw any Registration Statement or qualification of Registrable
        Securities if the Company in good faith determines that any such Registration
        Statement, or the use thereof, would materially and adversely affect any
        material corporate event or would otherwise require disclosure of nonpublic
        information which the Company determines, in its reasonable judgment, is
        not in
        the best interests of the Company at such time (an “Allowed Delay”);
        provided, that the Company shall promptly (a) notify the Investors in writing
        of
        the existence of (but in no event, without the prior written consent of the
        Investors, shall the Company disclose to the Investors any of the facts or
        circumstances regarding) the event giving rise to an Allowed Delay;
provided, however, that the Company shall not be required to
        disclose material nonpublic information to the Investors; (b) advise the
        Investors in writing to cease all sales under the Registration Statement
        until
        the end of the Allowed Delay; and (c) use reasonable best efforts to terminate
        an Allowed Delay as promptly as practicable.  Without the express
        written consent of the Investors, if required to permit the continued sale
        of
        Registrable Securities by the Investors, a post-effective amendment or
        supplement to the Registration Statement or the Prospectus constituting a
        part
        thereof must be filed no later than the 21st day following commencement of
        an
        Allowed Delay.

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      (d)           In
        the event that the Registration Statement should not be filed with the SEC
        within 60 days after the original issuance of the Convertible Preferred Stock
        and Warrants or be declared effective under the Securities Act within 150
        days
        after the original issuance of the Convertible Preferred Stock and Warrants,
        the
        Company shall pay to each Investor, as liquidated damages and not as a penalty,
        an aggregate amount in cash equal to (i) in the case of each Investor other
        than
        Tawes, Talty and JSH Partners, 0.5% of the purchase price paid by such Investor
        for the Convertible Preferred Stock and Investor Warrants for each month
        (or
        partial month) during which the Registration Statement has not been filed
        or
        declared effective as required by this Agreement, and (ii) in the case of
        Tawes,
        Talty and JSH Partners, 0.5% of the original principal amount of the 10%
        Notes
        or the 12% 2007 Bridge Note, as applicable, for each such month; provided
        that
        the aggregate payments shall not exceed 5.0% of the aggregate purchase price
        paid by (x) such Investor for such Convertible Preferred Stock and Investor
        Warrants, (y) Tawes and Talty for the 10% Notes and (z) JSH Partners for
        the 12%
        2007 Bridge Note (the “Liquidated Damages”).  The payment of
        Liquidated Damages shall be made within 30 days following the monthly period
        during which such Liquidated Damages were incurred.  For
        clarification, the Liquidated Damages shall be in addition to any other rights
        and remedies that the Investor may have available under this letter agreement,
        law or equity.

      

      (e)           In
        the event the Company is required by the SEC to reduce the number of Registrable
        Securities being registered for resale on the Registration Statement filed
        with
        the SEC pursuant to Section 2(a) hereof, the Registrable Securities sought
        to be
        registered by each Investor shall be so reduced on a pro rata basis in
        accordance with the total number of Registrable Securities sought to be
        registered by the Investors.  The Company shall notify the Investors
        in the event of any such reduction.  In the event of such reduction,
        the payment of Liquidated Damages by the Company to Investors described in
        Section 2(d) shall not be applicable to the extent the Company is in breach
        of
        the time periods set forth in Section 2(d) with respect to Registrable
        Securities excluded from the Registration Statement as a result of the reduction
        described in this Section 2(e) (the “Excluded Registrable
        Securities”).  The Company shall prepare and file a registration
        statement (the “Excluded Registration Statement”) with respect to the
        resale of the Excluded Registrable Securities with the SEC as promptly as
        practicable following the effectiveness of the Registration Statement, and
        the
        provisions of this Agreement shall be applicable to such Excluded Registration
        Statement mutatis mutandis on the same basis as the Registration
        Statement, including without limitation the provisions of Section
        2(d).

      

      3.           Company
        Obligations.  The Company will use reasonable best efforts to
        effect the registration of the Registrable Securities in accordance with
        the
        terms hereof, and pursuant thereto the Company will, as expeditiously as
        possible:

      

      (a)           use
        reasonable best efforts to cause such Registration Statement to become effective
        and to remain continuously effective for a period that will terminate upon
        the
        earliest of (i) the date on which all Registrable Securities covered by such
        Registration Statement as amended from time to time, have been sold, and
        (ii)
        the date on which all Registrable Securities covered by such Registration
        Statement may be sold pursuant to Rule 144(k) under the 1933 Act (the
“Effectiveness Period”);

      

      (b)           prepare
        and file with the SEC such amendments, prospectus supplements or post-effective
        amendments to the Registration Statement and the Prospectus as may be necessary
        to keep the Registration Statement effective for the period specified in
        Section 3(a) and to comply with the provisions of the 1933 Act and the
        1934 Act with respect to the distribution of all of the Registrable Securities
        covered thereby;

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      (c)           provide
        copies to and permit counsel designated by the Investors to review each
        Registration Statement and all amendments and supplements thereto no fewer
        than
        ten (10) days prior to their filing with the SEC and not file any document
        to
        which such counsel reasonably objects based upon such counsel’s belief that such
        Registration Statement is not in compliance with applicable laws, rules or
        regulations or contains a material misstatement or omission;

      

      (d)           furnish
        to the Investors and their legal counsel (i) promptly after the same is prepared
        and publicly distributed, filed with the SEC, or received by the Company
        (but
        not later than two (2) Business Days after the filing date, receipt date
        or
        sending date, as the case may be) one (1) copy of any Registration Statement
        and
        any amendment thereto, each preliminary prospectus and Prospectus and each
        amendment or supplement thereto, and each letter written by or on behalf
        of the
        Company to the SEC or the staff of the SEC, and each item of correspondence
        from
        the SEC or the staff of the SEC, in each case relating to such Registration
        Statement (other than any portion thereof which contains information for
        which
        the Company has sought confidential treatment), and (ii) such number of copies
        of a Prospectus, including a preliminary prospectus, and all amendments and
        supplements thereto and such other documents as the Investors may reasonably
        request in order to facilitate the disposition of the Registrable Securities
        owned by such Investors that are covered by the related Registration
        Statement;

      

      (e)           use
        reasonable best efforts to (i) prevent the issuance of any stop order or
        other
        suspension of effectiveness and, (ii) if such order is issued, obtain the
        withdrawal of any such order at the earliest possible moment;

      

      (f)           use
        reasonable best efforts to cause all Registrable Securities covered by a
        Registration Statement to be listed on each securities exchange, interdealer
        quotation system or other market on which similar securities issued by the
        Company are then listed;

      

      (g)           promptly
        notify the Investors upon the occurrence of any of the following events in
        respect of the Registration Statement or the Prospectus forming a part thereof:
        (i) receipt of any request for additional information from the SEC or any
        other
        federal or state governmental authority during the Effectiveness Period,
        the
        response to which would require any amendments or supplements to the
        Registration Statement or related Prospectus; (ii) the issuance by the SEC
        or
        any other federal or state governmental authority of any stop order suspending
        the effectiveness of the Registration Statement or the initiation of any
        proceedings for that purpose; (iii) receipt of any notification with respect
        to
        the suspension of the qualification or exemption from qualification of any
        of
        the Registrable Securities for sale in any jurisdiction or the initiation
        or
        threatening of any proceeding for such purpose; or (iv) the effectiveness
        of the
        Registration Statement within twenty four (24) hours of such Registration
        Statement being declared effective;

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

      (h)           immediately
        notify the Investors, at any time when a Prospectus relating to Registrable
        Securities is required to be delivered under the 1933 Act, upon discovery
        that,
        or upon the happening of any event or the passage of time as a result of
        which,
        the Prospectus included in a Registration Statement, as then in effect, includes
        an untrue statement of a material fact or omits to state any material fact
        required to be stated therein or necessary to make the statements therein
        not
        misleading in light of the circumstances then existing, and at the request
        of
        any such holder, promptly prepare and furnish to such holder a reasonable
        number
        of copies of a supplement to or an amendment of such Prospectus or the
        Registration Statement as may be necessary so that, as thereafter delivered
        to
        the purchasers of such Registrable Securities, such Prospectus shall not
        include
        an untrue statement of a material fact or omit to state a material fact required
        to be stated therein or necessary to make the statements therein not misleading
        in light of the circumstances then existing;

      

      (i)           otherwise
        use reasonable best efforts to comply with all applicable rules and regulations
        of the SEC under the 1933 Act and the 1934 Act, take such other actions as
        may
        be reasonably necessary to facilitate the registration of the Registrable
        Securities hereunder;

      

      (j)           with
        a view to making available to the Investors the benefits of Rule 144 (or
        its
        successor rule) and any other rule or regulation of the SEC that may at any
        time
        permit the Investor to sell Common Shares to the public without registration,
        the Company covenants and agrees to:  (i) make and keep public
        information available, as those terms are understood and defined in Rule
        144,
        until the earlier of (A) six months after such date as all of the Registrable
        Securities may be resold pursuant to Rule 144(k) or any other rule of similar
        effect or (B) such date as all of the Registrable Securities shall have been
        resold; (ii) file with the SEC in a timely manner all reports and other
        documents required of the Company under the 1934 Act; and (iii) furnish to
        each
        Investor upon request, as long as such Investor owns any Registrable Securities,
        (A) a written statement by the Company that it has complied with the reporting
        requirements of the 1934 Act, and (B) such other information as may be
        reasonably requested in order to avail such Investor of any rule or regulation
        of the SEC that permits the selling of any such Registrable Securities without
        registration;

      

      (k)           if
        requested by the Required Investors, (i) promptly incorporate in a Prospectus
        supplement or post-effective amendment to the Registration Statement such
        information as the Company reasonably agrees should be included therein and
        (ii)
        make all required filings of such Prospectus supplement or such post-effective
        amendment as soon as practicable after the Company has received notification
        of
        the matters to be incorporated in such Prospectus supplement or post-effective
        amendment;

      

      (l)           cooperate
        with the Investors to facilitate the timely preparation and delivery of
        certificates representing Registrable Securities to be sold pursuant to a
        Registration Statement, which certificates shall, if required under the terms
        of
        this Agreement, be free of all restrictive legends, and to enable such
        Registrable Securities to be in such denominations and registered in such
        names
        as the Investors may request within the applicable time periods prescribed
        for
        the issuance of shares upon conversion of the Convertible Preferred Stock
        or
        exercise of Warrants; and

      

      (m)           prior
        to any public offering of Registrable Securities, register or qualify (unless
        an
        exemption from such registration of qualification is available) the Registrable
        Securities for offer and sale under the securities or Blue Sky laws of such
        jurisdictions within the United States as the Investor requests in writing,
        keep
        each such registration or qualification (or exemption therefrom) effective
        during the Effectiveness Period and do any and all other acts or things
        necessary or advisable to enable the disposition in such jurisdictions of
        the
        Registrable Securities covered by a Registration Statement; provided,
however, that the Company shall not be required to qualify generally
        to
        do business in any jurisdiction where it is not then so qualified or to take
        any
        action that would subject it to general service of process in any such
        jurisdiction where it is not then so subject or subject the Company to any
        material tax in any such jurisdiction where it is not then so
        subject.

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

       

      4.           Due
        Diligence Review; Information.  The Company shall make available,
        during normal business hours, upon reasonable request, for inspection and
        review
        by the Investors, advisors to and representatives of the Investors (who may
        or
        may not be affiliated with the Investors and who are reasonably acceptable
        to
        the Company), all financial and other records, all filings with the SEC,
        and all
        other documents respecting the Company, its assets, its properties or its
        business (including without limitation minute books, corporate records,
        financial statements, contracts, permits, licenses, approvals, technical
        or
        engineering reports, and any title opinions or valuations which the Company
        has
        obtained) as may be reasonably necessary for the purpose of such review,
        and
        cause the Company’s officers, directors and employees, within a reasonable time
        period, to supply all such information reasonably requested by the Investors
        or
        any such representative, advisor or underwriter in connection with such
        Registration Statement (including, without limitation, in response to all
        questions and other inquiries reasonably made or submitted by any of them)
        to
        the extent not publicly available on EDGAR or the Company’s website, prior to
        and from time to time after the filing and effectiveness of the Registration
        Statement for the sole purpose of enabling the Investor and such
        representatives, advisors and underwriters and their respective accountants
        and
        attorneys to conduct initial and ongoing due diligence with respect to the
        Company and the accuracy of such Registration Statement.

      

      Notwithstanding
        any of the foregoing, nothing herein shall obligate the Company to provide
        to
        the Investor, or any advisors or representatives or underwriters, any material
        nonpublic information.  The Company shall not disclose material
        nonpublic information to the Investor, or to advisors to or representatives
        of
        the Investor, unless prior to disclosure of such information the Company
        identifies such information as being material nonpublic information and provides
        the Investor, such advisors and representatives with the opportunity to accept
        or refuse to accept such material nonpublic information for review and the
        Investors wishing to obtain such information enters into an appropriate
        confidentiality agreement with the Company with respect thereto.

      

      
        	
                 

              	
                5.

              	
                Obligations
                  of the Investors.

              

      

      

      (a)           Each
        Investor shall furnish in writing to the Company such information regarding
        itself, the Registrable Securities held by it and the intended method of
        disposition of the Registrable Securities held by it, as shall be reasonably
        required to effect the registration of such Registrable Securities and shall
        execute such documents in connection with such registration as the Company
        may
        reasonably request.  At least fifteen (15) Business Days prior to the
        first anticipated filing date of any Registration Statement, the Company
        shall
        notify each Investor of the information the Company requires from the Investor
        if the Investor elects to have any of the Registrable Securities included
        in the
        Registration Statement.  The Investor shall provide such information
        to the Company at least two (2) Business Days prior to the first anticipated
        filing date of such Registration Statement if such Investor elects to have
        any
        of the Registrable Securities included in the Registration
        Statement.  The Company shall not be required to include the
        Registrable Securities of an Investor in a Registration Statement and shall
        not
        be required to pay any damages to any person who fails to furnish to the
        Company
        such information at least two (2) Business Days prior to such filing
        date.

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

       

      (b)           The
        Investors, by their acceptance of the Registrable Securities, agree to cooperate
        with the Company as reasonably requested by the Company in connection with
        the
        preparation and filing of a Registration Statement hereunder, unless any
        such
        Investor (i) has notified the Company in writing of its election to exclude
        all
        of its Registrable Securities from such Registration Statement; or (ii) has
        not
        provided a timely response to the request by the Company for information
        from
        such Investor set forth in Section 5(a) hereof.

      

      (c)           Each
        Investor agrees that, upon receipt of any notice (which may be oral as long
        as
        written notice is provided by the next day) from the Company of the commencement
        of an Allowed Delay pursuant to Section 2(c)(ii), the Investor will
        immediately discontinue disposition of Registrable Securities pursuant to
        the
        Registration Statement covering such Registrable Securities, until otherwise
        notified in writing by the Company or until the Investor’s receipt of the copies
        of the supplemented or amended Prospectus filed with the SEC and until any
        related post-effective amendment is declared effective and, if so directed
        by
        the Company and the Investor shall deliver to the Company (at the expense
        of the
        Company) or destroy (and deliver to the Company a certificate of destruction)
        all copies in the Investor’s possession of the Prospectus covering the
        Registrable Securities current at the time of receipt of such
        notice.

      

      (d)           The
        Investors acknowledge and agree that, to the extent described in Schedule
        5(d) hereto, other security holders of the Company have the right to include
        such securities, in addition to the Registrable Securities, in any Registration
        Statement filed or maintained by the Company pursuant to this Agreement or
        the
        Transaction Documents.

      

      (e)           Each
        Investor covenants and agrees that it will comply with the prospectus delivery
        requirements of the 1933 Act as applicable to it in connection with sales
        of
        Registrable Securities pursuant to the Registration Statement.

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

       

      
        	
                 

              	
                6.

              	
                Indemnification.

              

      

      

      (a)           Indemnification
        by the Company.  The Company will indemnify and hold harmless each
        Investor, and each of its officers, directors, members, employees and agents,
        successors and assigns, and each other person, if any, who controls such
        Investor within the meaning of the 1933 Act, against any losses, claims,
        damages, liabilities and expense (including reasonable attorney fees), joint
        or
        several, to which they may become subject under the 1933 Act or otherwise,
        insofar as such losses, claims, damages or liabilities (or actions in respect
        thereof) arise out of or are based upon: (i) any untrue statement or alleged
        untrue statement of any material fact contained in any Registration Statement,
        any preliminary prospectus or final prospectus contained therein, or any
        amendment or supplement thereof; (ii) any application or other document or
        communication (in this paragraph (a), referred to collectively as an
“application”) executed by, or on behalf of, the Company or based upon written
        information furnished by, or on behalf of, the Company filed in any jurisdiction
        in order to register or qualify any of the Registrable Securities under the
        securities or “blue sky” laws thereof or filed with any securities exchange;
        (iii) the omission or alleged omission to state therein a material fact required
        to be stated therein or necessary to make the statements therein not misleading;
        (iv) any violation by the Company or its agents of any rule or regulation
        promulgated under the 1933 Act applicable to the Company or its agents and
        relating to action or inaction required of the Company in connection with
        such
        registration; (v) any failure to register or qualify the Registrable Securities
        included in any such Registration Statement in any state where the Company
        or
        its agents has affirmatively undertaken or agreed in writing that the Company
        will undertake such registration or qualification on the Investor’s behalf; or
        (vi) any breach of any representation, warranty, covenant, or agreement of
        the
        Company contained in this Agreement and will reimburse such Investor, and
        each
        such officer, director or member and each such controlling person for any
        legal
        or other expenses reasonably incurred by them in connection with investigating
        or defending any such loss, claim, damage, liability or action; provided,
however, that the Company will not be liable in any such case if
        and to
        the extent that any such loss, claim, damage or liability arises out of or
        is
        based upon an untrue statement or alleged untrue statement or omission or
        alleged omission so made in conformity with information furnished by the
        Investor in writing specifically for use in such Registration Statement or
        Prospectus, or to the extent that such information relates to the Investor
        or
        the Investor’s proposed method of distribution of Registrable Securities and was
        reviewed and approved by the Investor for use in the Registration Statement,
        such Prospectus or such form of Prospectus or in any amendment or supplement
        thereto (it being understood that the Investors have approved Exhibit A
        hereto for this purpose), or in the case of an occurrence of an Allowed Delay
        or
        of an event of the type specified in Section 3(g), the use by the
        Investor of an outdated or defective Prospectus after the Company has notified
        the Investor in writing that the Prospectus is outdated or defective and
        prior
        to the receipt by the Investor of an amended or supplemented Prospectus,
        but
        only if and to the extent that following the receipt of such amended or
        supplemented Prospectus the misstatement or omission giving rise to such
        liability would have been corrected.

      

      (b)           Indemnification
        by the Investor.  Each Investor agrees, severally but not jointly,
        to indemnify and hold harmless, to the fullest extent permitted by law, the
        Company, its directors, officers, employees, shareholders and each person
        who
        controls the Company (within the meaning of the 1933 Act) against any losses,
        claims, damages, liabilities and expense (including reasonable attorney fees)
        resulting from any untrue statement of a material fact or any omission of
        a
        material fact required to be stated in the Registration Statement or Prospectus
        or preliminary prospectus or amendment or supplement thereto or necessary
        to
        make the statements therein not misleading, to the extent that such untrue
        statement or omission is contained in any information furnished in writing
        by
        the Investor to the Company specifically for inclusion in such Registration
        Statement or Prospectus or amendment or supplement thereto, or to the extent
        that such information relates to such Investor’s proposed method of distribution
        of Registrable Securities and was reviewed and approved by the Investor for
        use
        in the Registration Statement (it being understood that the Investor has
        approved Exhibit A hereto for this purpose), such Prospectus or such form
        of Prospectus or in any amendment or supplement thereto, or in the case of
        an
        occurrence of an Allowed Delay or an event of the type specified in Section
        3(g), the use by the Investor of an outdated or defective Prospectus after
        the Company has notified the Investor in writing that the Prospectus is outdated
        or defective and prior to the receipt by the Investor of an amended or
        supplemented Prospectus, but only if and to the extent that following the
        receipt of the amended or supplemented Prospectus the misstatement or omission
        giving rise to such liability would have been corrected.  In no event
        shall the liability of the Investor be greater in amount than the dollar
        amount
        of the proceeds (net of any damages the Investor has otherwise been required
        to
        pay by reason of such untrue statement or omission by the Company) received
        by
        the Investor upon the sale of the Registrable Securities included in the
        Registration Statement giving rise to such indemnification
        obligation.

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

       

      (c)           Conduct
        of Indemnification Proceedings.  Any person entitled to
        indemnification hereunder shall (i) give prompt notice to the indemnifying
        party
        of any claim with respect to which it seeks indemnification; and (ii) permit
        such indemnifying party to assume the defense of such claim with counsel
        reasonably satisfactory to the indemnified party; provided that any
        person entitled to indemnification hereunder shall have the right to employ
        separate counsel and to participate in the defense of such claim, but the
        fees
        and expenses of such counsel shall be at the expense of such person unless
        (a)
        the indemnifying party has agreed to pay such fees or expenses; or (b) the
        indemnifying party shall have failed to assume the defense of such claim
        and
        employ counsel reasonably satisfactory to such person; or (c) in the reasonable
        judgment of any such person, based upon written advice of its counsel, a
        conflict of interest exists between such person and the indemnifying party
        with
        respect to such claims (in which case, if the person notifies the indemnifying
        party in writing that such person elects to employ separate counsel at the
        expense of the indemnifying party, the indemnifying party shall not have
        the
        right to assume the defense of such claim on behalf of such person); or (d)
        the
        indemnified party shall have reasonably concluded, with the advice of counsel,
        that there may be one or more legal defenses available to it or them or to
        other
        indemnified parties which are different from, or in addition to, those available
        to the indemnifying party; and provided, further, that the failure
        of any indemnified party to give notice as provided herein shall not relieve
        the
        indemnifying party of its obligations hereunder, except to the extent that
        such
        failure to give notice shall materially adversely affect the indemnifying
        party
        in the defense of any such claim or litigation.  It is understood that
        the indemnifying party shall not, in connection with any proceeding in the
        same
        jurisdiction, be liable for fees or expenses of more than one separate firm
        of
        attorneys at any time for all such indemnified parties.  No
        indemnifying party will, except with the consent of the indemnified party,
        consent to entry of any judgment or enter into any settlement that does not
        include as an unconditional term thereof the giving by the claimant or plaintiff
        to such indemnified party of a release from all liability in respect of such
        claim or litigation.  The Company agrees promptly to notify the
        Investors of the commencement of any litigation or proceedings against the
        Company or any of its officers or directors in connection with the sale of
        any
        Registrable Securities or any preliminary prospectus, prospectus, registration
        statement, or amendment or supplement thereto, or any application relating
        to
        any sale of any Registrable Securities.

      

      (d)           Contribution.  If
        for any reason the indemnification provided for in the preceding paragraphs
        (a)
        and (b) is unavailable to an indemnified party or insufficient to hold it
        harmless, other than as expressly specified therein, then the indemnifying
        party
        shall contribute to the amount paid or payable by the indemnified party as
        a
        result of such loss, claim, damage or liability in such proportion as is
        appropriate to reflect the relative fault of the indemnified party and the
        indemnifying party, as well as any other relevant equitable
        considerations.  The relative fault, in the case of an untrue
        statement, alleged untrue statement, omission, or alleged omission, shall
        be
        determined by, among other things, whether such statement, alleged statement,
        omission, or alleged omission relates to information supplied by the Company
        or
        by the Investor, and the parties' relative intent, knowledge, access to
        information, and opportunity to correct or prevent such statement, alleged
        statement, omission, or alleged omission.  The parties agree that it
        would be unjust and inequitable if the respective obligations of the Company
        and
        the Investor for contribution were determined by pro rata or per capita
        allocation of the aggregate losses, liabilities, claims, damages, and expenses
        or by any other method of allocation that does not reflect the equitable
        considerations referred to in this paragraph (d).  No person guilty of
        fraudulent misrepresentation within the meaning of Section 11(f) of the 1933
        Act
        shall be entitled to contribution from any person not guilty of such fraudulent
        misrepresentation.  In no event shall the contribution obligation of a
        holder of Registrable Securities be greater in amount than the dollar amount
        of
        the proceeds (net of all expenses paid by such holder in connection with
        any
        claim relating to this Section 6 and the amount of any damages such
        holder has otherwise been required to pay by reason of such untrue or alleged
        untrue statement or omission or alleged omission) received by it upon the
        sale
        of the Registrable Securities giving rise to such contribution
        obligation.  Anything in this paragraph 6(d) to the contrary
        notwithstanding, no party shall be liable for contribution with respect to
        the
        settlement of any claim or action effected without its written
        consent.  This paragraph 6(d) is not intended to supersede any right
        to contribution under the 1933 Act, the 1934 Act, or otherwise.

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

       

      
        	
                 

              	
                7.

              	
                Miscellaneous.

              

      

      

      (a)           Amendments
        and Waivers.  This Agreement may be amended only by an instrument
        in writing signed by the Company and the Required Investors, provided that
        no
        amendment to this Agreement that is adverse to any Investor shall be made
        without such Investor’s written consent.  The Company may take any
        action herein prohibited, or omit to perform any act herein required to be
        performed by it, only if the Company shall have obtained the written waiver
        or
        consent to such amendment, action or omission to act, of the Required Investors,
        provided that no such action or omission that is adverse to any Investor
        shall
        occur without such Investor’s written consent.

      

      (b)           Notices.   All
        notices that are required or permitted hereunder shall be in writing and
        shall
        be sufficient if personally delivered, sent by facsimile in the case of notice
        to the Company only, or sent by registered or certified mail or Federal Express
        or other nationally recognized overnight delivery service.  Any
        notices shall be deemed given upon the earlier of the date when received
        at, the
        day when delivered via facsimile or the third day after the date when sent
        by
        registered or certified mail or the day after the date when sent by Federal
        Express to, the address set forth below, unless such address is changed by
        notice to the other party hereto:

      

      To
        the
        Company:

      

      Baywood
        International, Inc.

      14950
        North 83rd
        Place

      Suite
        1

      Scottsdale,
        Arizona 85260

      Attn:
        Chief Executive Officer

      Facsimile:
        (480) 483-2168

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

       

      With
        a
        copy to:

      

      Meltzer,
        Lippe, Goldstein & Breitstone, LLP

      190
        Willis Avenue

      Mineola,
        New York 11501

      Attention:
        David I. Schaffer, Esq.

      Facsimile:
        747-0653

      

      To
        the
        Investor:  As set forth on Schedule 1 to this Agreement.

      

      With
        a
        copy to:

      

      Northeast
        Securities, Inc.

      100
        Wall
        Street, 8th Floor

      New
        York,
        New York 10005

      Attention:
        David Tsiang, Senior Vice President

      Facsimile:  (212)
        269-0126

      

      To
        Tawes:

      

      O.
        Lee
        Tawes, III

      c/o
        Northeast Securities, Inc.

      100
        Wall
        Street, 8th Floor

      New
        York,
        New York 10005

      Attention:
        David Tsiang, Senior Vice President

      Facsimile:  (212)
        269-0126

      

      With
        a
        copy to:

      

      Hand
        Baldachin & Amburgey LLP

      1775
        Broadway, Suite 2300

      New
        York,
        New York 10019

      Attention:
        David C. Amburgey, Esq.

      Facsimile:
        (212) 259-3910

      

      To
        Talty:

      

      John
        Talty

      c/o
        Seix
        Advisors

      10
        Mountainview Road

      Upper
        Saddle River, NJ 07458

      Attention:
        John Talty

      Facsimile:
        (201) 391-0300    
       

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

       

      To
        JSH
        Partners:

      

      JSH
        Partners

      c/o
        Northeast Securities, Inc.

      100
        Wall
        Street, 8th
        Floor

      New
        York,
        New York 10019

      Attention:  Jack
        Harris, Managing Director

      Facsimile:
        (212) 607-5484

      

      

      (c)           Assignments
        and Transfers by Investors.  The provisions of this Agreement
        shall be binding upon and inure to the benefit of the Investors and their
        successors and assigns.  An Investor may transfer or assign, in whole
        or from time to time in part, to one or more persons, which shall be an
“accredited investor” as defined in Rule 501(a) of Regulation D, as amended
        under the 1933 Act, and which shall agree in writing to be bound by the terms
        and conditions of this Agreement, an executed counterpart of which shall
        be
        furnished to the Company, its rights hereunder in connection with the transfer
        of Registrable Securities by such Investor to such person, provided that
        the
        Investor complies with all laws applicable thereto and provides written notice
        of assignment to the Company promptly after such assignment is
        effected.

      

      (d)           Assignments
        and Transfers by the Company.  This Agreement may not be assigned
        by the Company (whether by operation of law or otherwise) without the prior
        written consent of the Required Investors, provided, however, that the Company
        may assign its rights and delegate its duties hereunder to any surviving
        or
        successor corporation in connection with a merger or consolidation of the
        Company with another corporation, or a sale, transfer or other disposition
        of
        all or substantially all of the Company’s assets to another corporation, without
        the prior written consent of the Required Investors, after notice duly given
        by
        the Company to the Investors.

      

      (e)           Benefits
        of the Agreement.  The terms and conditions of this Agreement
        shall inure to the benefit of and be binding upon the respective permitted
        successors and assigns of the parties.  Nothing in this Agreement,
        express or implied, is intended to confer upon any party other than the parties
        hereto or their respective successors and assigns any rights, remedies,
        obligations, or liabilities under or by reason of this Agreement, except
        as
        expressly provided in this Agreement.

      

      (f)           Counterparts;
        Faxes.  This Agreement may be executed in two or more
        counterparts, each of which shall be deemed an original, but all of which
        together shall constitute one and the same instrument.  This Agreement
        may also be executed via facsimile, which shall be deemed an
        original.

      

      (g)           Titles
        and Subtitles.  The titles and subtitles used in this Agreement
        are used for convenience only and are not to be considered in construing
        or
        interpreting this Agreement.

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

       

      (h)           Severability.  Any
        provision of this Agreement that is prohibited or unenforceable in any
        jurisdiction shall, as to such jurisdiction, be ineffective to the extent
        of
        such prohibition or unenforceability without invalidating the remaining
        provisions hereof but shall be interpreted as if it were written so as to
        be
        enforceable to the maximum extent permitted by applicable law, and any such
        prohibition or unenforceability in any jurisdiction shall not invalidate
        or
        render unenforceable such provision in any other jurisdiction.  To the
        extent permitted by applicable law, the parties hereby waive any provision
        of
        law which renders any provisions hereof prohibited or unenforceable in any
        respect.

      

      (i)           Further
        Assurances.  The parties shall execute and deliver all such
        further instruments and documents and take all such other actions as may
        reasonably be required to carry out the transactions contemplated hereby
        and to
        evidence the fulfillment of the agreements herein contained.

      

      (j)           Entire
        Agreement.  This Agreement is intended by the parties as a final
        expression of their agreement and intended to be a complete and exclusive
        statement of the agreement and understanding of the parties hereto in respect
        of
        the subject matter contained herein.  This Agreement supersedes all
        prior agreements and understandings between the parties with respect to such
        subject matter.

      

      (k)           Governing
        Law; Consent to Jurisdiction; Waiver of Jury Trial.  This
        Agreement shall be governed by, and construed in accordance with, the internal
        laws of the State of New York without regard to the choice of law principles
        thereof.  Each of the parties hereto irrevocably submits to the
        exclusive jurisdiction of the courts of the State of New York and the United
        States District Court for the Southern District of New York, in each case
        located in the City of New York, Borough of Manhattan, for the purpose of
        any
        suit, action, proceeding or judgment relating to or arising out of this
        Agreement and the transactions contemplated hereby.  Service of
        process in connection with any such suit, action or proceeding may be served
        on
        each party hereto anywhere in the world by the same methods as are specified
        for
        the giving of notices under this Agreement.  Each of the parties
        hereto irrevocably consents to the jurisdiction of any such court in any
        such
        suit, action or proceeding and to the laying of venue in such
        court.  Each party hereto irrevocably waives any objection to the
        laying of venue of any such suit, action or proceeding brought in such courts
        and irrevocably waives any claim that any such suit, action or proceeding
        brought in any such court has been brought in an inconvenient forum.
EACH OF THE PARTIES HERETO WAIVES ANY RIGHT TO REQUEST A TRIAL BY
        JURY
        IN ANY LITIGATION WITH RESPECT TO THIS AGREEMENT AND REPRESENTS THAT COUNSEL
        HAS
        BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

       

      [Company
        Signature Page]

      

      IN
        WITNESS WHEREOF, the parties have
        executed this Agreement or caused their duly authorized officers to execute
        this
        Agreement as of the date first above written.

      

      

      
        	 	
                BAYWOOD
                  INTERNATIONAL, INC.

              
	 	
                14950
                  North 83rd
                  Place

              
	 	
                Scottsdale,
                  Arizona 85260

              
	 	 	 
	 	 	 
	 	
                By:

              	
                /s/
                  Neil Reithinger

              
	 	 	
                Name:
                  Neil Reithinger

              
	 	 	
                Title:
                  President & CEO

              

      

      

        
          
            
            

          

          
            15

            
              

            

          

          
            
            

          

        

      

       

      [Investor
        Signature Page]

      

      IN
        WITNESS WHEREOF, the parties have executed this Agreement or caused their
        duly
        authorized officers or attorney-in-fact to execute this Agreement as of the
        date
        first above written.

      

      

      
        	 	
                Name
                  of Investor:

              	 

      

      

      

      
        	 	
                By:

              	
                NORTHEAST
                  SECURITIES, INC.

              
	 	 	
                Attorney-in-Fact

              

      

      

      
        	 	
                By:

              	
                David
                  Tsiang

              
	 	 	
                Name:
                  David Tsiang

              
	 	 	
                Title:
                  Senior  Vice
                  President

              

      

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

      [Tawes
        Signature Page]

      

      IN
        WITNESS WHEREOF, the parties have
        executed this Agreement or caused their duly authorized officers or
        attorney-in-fact to execute this Agreement as of the date first above
        written.

       

       

      
        
          	 	
                  /s/
                    O. Lee Tawes, III

                
	 	
                  O.
                    Lee Tawes, III

                

        

      

      

        
          
            
            

          

          
            17

            
              

            

          

          
            
            

          

        

      

       

      [Talty
        Signature Page]

      

      IN
        WITNESS WHEREOF, the parties have
        executed this Agreement or caused their duly authorized officers or
        attorney-in-fact to execute this Agreement as of the date first above
        written.

      

      

      
        	 	
                /s/
                  John Talty

              
	 	
                John
                  Talty

              

      

      

        
          
            
            

          

          
            18

            
              

            

          

          
            
            

          

        

      

       

      [JSH
        Partners Signature Page]

      

      IN
        WITNESS WHEREOF, the parties have executed this Agreement or caused their
        duly
        authorized officers or attorney-in-fact to execute this Agreement as of the
        date
        first above written.

      

      
        	 	
                JSH
                  PARTNERS

              
	 	 	 
	 	 	 
	 	
                By:

              	
                /s/
                  Jack Harris

              
	 	 	
                Name:
                  Jack Harris

              
	 	 	
                Title:
                  Managing Director

              

      

      
        
          
          

        

        
          19

          
            

          

        

        
          
          

        

      

      Schedule
        1

      Investors

      

      
        	
                Investor
                  Name

              	
                Investor
                  Contact Details

              
	 	 
	 	 
	 	 
	 	 

      

      

        
          
            
            

          

          
            20

            
              

            

          

          
            
            

          

        

      

       

      Schedule
        5(d)

      

      Other
        Securities to be Registered

       

      
        
          
          

        

        
          21

          
            

          

        

        
          
          

        

      

       

      Exhibit
        A

      Plan
        of Distribution

      

      

      The
        selling shareholders, which as used herein includes donees, pledgees,
        transferees or other successors-in-interest selling common shares or interests
        in common shares received after the date of this prospectus from a selling
        shareholder as a gift, pledge, partnership distribution or other transfer,
        may,
        from time to time, sell, transfer or otherwise dispose of any or all of their
        common shares or interests in common shares on any stock exchange, market
        or
        trading facility on which the common shares are traded or in private
        transactions.  These dispositions may be at fixed prices, at
        prevailing market prices at the time of sale, at prices related to the
        prevailing market price, at varying prices determined at the time of sale,
        or at
        negotiated prices.

      

      The
        selling shareholders may use any one or more of the following methods when
        disposing of common shares or interests therein:

      

      -
        ordinary brokerage transactions and transactions in which the broker-dealer
        solicits purchasers;

      

      -
        block
        trades in which the broker-dealer will attempt to sell the common shares
        as
        agent, but may position and resell a portion of the block as principal to
        facilitate the transaction;

      

      -
        purchases by a broker-dealer as principal and resale by the broker-dealer
        for
        its account;

      

      -
        an
        exchange distribution in accordance with the rules of the applicable
        exchange;

      

      -
        privately negotiated transactions;

      

      -
        short
        sales effected after the date of this prospectus;

      

      -
        through
        the writing or settlement of options or other hedging transactions, whether
        through an options exchange or otherwise;

      

      -
        broker-dealers may agree with the selling shareholders to sell a specified
        number of such common shares at a stipulated price per common
        share;

      

      -
        a
        combination of any such methods of sale; and

      

      -
        any
        other method permitted pursuant to applicable law.

      

      The
        selling shareholders may, from time to time, pledge or grant a security interest
        in some or all of the common shares owned by them and, if they default in
        the
        performance of their secured obligations, the pledgees or secured parties
        may
        offer and sell the common shares, from time to time, under this prospectus,
        or
        under an amendment to this prospectus under Rule 424(b)(3) or other applicable
        provision of the Securities Act of 1933 (the “1933 Act”) amending the list of
        selling shareholders to include the pledgee, transferee or other successors
        in
        interest as selling shareholders under this prospectus.  The selling
        shareholders also may transfer the common shares in other circumstances,
        in
        which case the transferees, pledgees or other successors in interest will
        be the
        selling beneficial owners for purposes of this prospectus.

      
        
          
          

        

        
          22

          
            

          

        

        
          
          

        

      

       

      In
        connection with the sale of our common shares or interests therein, the selling
        shareholders may enter into hedging transactions with broker-dealers or other
        financial institutions, which may in turn engage in short sales of the common
        shares in the course of hedging the positions they assume.  The
        selling shareholders may also sell our common shares short and deliver these
        securities to close out their short positions, or loan or pledge the common
        shares to broker-dealers that in turn may sell these securities.  The
        selling shareholders may also enter into option or other transactions with
        broker-dealers or other financial institutions or the creation of one or
        more
        derivative securities which require the delivery to such broker-dealer or
        other
        financial institution of shares offered by this prospectus, which shares
        such
        broker-dealer or other financial institution may resell pursuant to this
        prospectus (as supplemented or amended to reflect such
        transaction).

      

      The
        aggregate proceeds to the selling shareholders from the sale of the common
        shares offered by them will be the purchase price of the common shares less
        discounts or commissions, if any.  Each of the selling shareholders
        reserves the right to accept and, together with their agents from time to
        time,
        to reject, in whole or in part, any proposed purchase of common shares to
        be
        made directly or through agents.  We will not receive any of the
        proceeds from this offering.

      

      The
        selling shareholders also may resell all or a portion of the shares in open
        market transactions in reliance upon Rule 144 under the Securities Act of
        1933,
        provided that they meet the criteria and conform to the requirements of that
        rule.

      

      The
        selling shareholders and any underwriters, broker-dealers or agents that
        participate in the sale of the common shares or interests therein may be
        "underwriters" within the meaning of Section 2(11) of the 1933
        Act.  Any discounts, commissions, concessions or profit they earn on
        any resale of the shares may be underwriting discounts and commissions under
        the
        1933 Act.  Selling shareholders who are "underwriters" within the
        meaning of Section 2(11) of the 1933 Act will be subject to the prospectus
        delivery requirements of the 1933 Act.

      

      To
        the
        extent required, our common shares to be sold, the names of the selling
        shareholders, the respective purchase prices and public offering prices,
        the
        names of any agents, dealer or underwriter, any applicable commissions or
        discounts with respect to a particular offer will be set forth in an
        accompanying prospectus supplement or, if appropriate, a post-effective
        amendment to the registration statement that includes this
        prospectus.

      

      In
        order
        to comply with the securities laws of some states, if applicable, the common
        shares may be sold in these jurisdictions only through registered or licensed
        brokers or dealers.  In addition, in some states the common shares may
        not be sold unless it has been registered or qualified for sale or an exemption
        from registration or qualification requirements is available and is complied
        with.

      
        
          
          

        

        
          23

          
            

          

        

        
          
          

        

      

       

      We
        have
        advised the selling shareholders that the anti-manipulation rules of Regulation
        M under the Exchange Act may apply to sales of shares in the market and to
        the
        activities of the selling shareholders and their affiliates.  In
        addition, we will make copies of this prospectus (as it may be supplemented
        or
        amended from time to time) available to the selling shareholders for the
        purpose
        of satisfying the prospectus delivery requirements of the 1933
        Act.  The selling shareholders may indemnify any broker-dealer that
        participates in transactions involving the sale of the shares against certain
        liabilities, including liabilities arising under the 1933 Act.

      

      We
        have
        agreed to indemnify the selling shareholders against liabilities, including
        liabilities under the 1933 Act and state securities laws, relating to the
        registration of the shares offered by this prospectus.

      

      We
        have
        agreed with the selling shareholders to keep the registration statement of
        which
        this prospectus constitutes a part effective until the earlier of (1) such
        time
        as all of the shares covered by this prospectus have been disposed of pursuant
        to and in accordance with the registration statement, (2) the date on which
        the
        shares may be sold pursuant to Rule 144 under the 1933 Act, and (3) the date
        on
        which the shares (other than shares held by our Affiliates) may be sold pursuant
        to Rule 144(k) of the 1933 Act.

    

     

     

    24

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00126-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00126-of-00352.parquet"}]]