NutraCea Suite 400 Phoenix, Arizona 85018 Dear Brad:
April
__,
2007
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
Suite
400
Phoenix,
Arizona 85018
Dear
▇▇▇▇:
We
own or
have the right to acquire the Senior Secured Convertible Notes (the “Notes”) of
Vital Living, Inc. (the “Company”) set forth on Schedule A. We
would be interested in selling the Notes to you on the terms and conditions
set
forth below.
1. Sale
of the Notes. At
the Closing as described below, we as seller will convey, transfer, and assign,
upon the terms and conditions hereinafter set forth, to you as buyer, free
and
clear of all liens, pledges, claims, and encumbrances of every kind, nature,
and
description, and we will purchase from you, the Notes.
2. Purchase
Price. You
will pay to us the sum of $1,000 in cash for each $1,000 in aggregate principal
amount of the Notes purchased hereunder and any accrued interest thereon
upon
the delivery of the Notes, or total purchase price of $__________, subject
to
Paragraph 7 below.
3. Your
Representations, Warranties, and Agreements. To
induce us to enter into this Agreement, you as buyer represent, warrant,
and
agree as follows:
(a) Power
of the Company to Execute Agreement. You
have full power and authority to execute, deliver, and perform this Agreement,
and this Agreement is your legal and binding obligation and is enforceable
against you in accordance with its terms.
(b) Agreement
Not in Breach. The
execution and delivery of this Agreement, the consummation of the transactions
hereby contemplated, and the fulfillment of the terms hereof will not result
in
the breach of any term or provision of, or constitute a default under, or
conflict with, or cause the acceleration of any obligation under, any agreement
or other instrument of any description to which you are a party or by which
you
are is bound, or any judgment, decree, order, or award of any court,
governmental body, or arbitrator or any applicable laws, rule, or
regulation.
4. Our
Representations, Warranties, and Agreements. To
induce you to enter into this Agreement, we as seller represent, warrant,
and
agree as follows:
(a) Power
of the Buyer to Execute Agreement. We
have full power and authority to execute, deliver, and perform this Agreement,
and this Agreement is our legal and binding obligation and is enforceable
against us in accordance with its terms.
(b) Agreement
Not in Breach. The
execution and delivery of this Agreement, the consummation of the transactions
contemplated hereby, and the fulfillment of the terms hereof will not result
in
the breach of any term or provision of, or constitute a default under, or
conflict with, or cause the acceleration of any obligation under, any agreement
or other instrument of any description to which we are a party or by which
we
are bound, or any judgment, decree, order or award of any court, governmental
body, or arbitrator or any applicable law, rule, or regulation.
(c) Ownership. We
own or have the right to acquire the Notes free and clear of any liens, claims,
or encumbrances.
5. Your
Acknowledgments. You
as buyer acknowledge as follows:
(a) Our
Makeup. You
understand that we are a newly formed limited liability company whose members
include the Chief Executive Officer of the Company. You also
understand that we have or will purchase the Notes at a discount from their
principal amounts.
(b) Absence
of Any Representations or Warranties. Other
than as specifically set forth herein, you acknowledge that neither we nor
the
Company has made any representations or warranties to you of any kind
representing the business, affairs, financial condition, plans, or prospects
of
the Company nor have you relied on any representations, warranties, agreements,
or statements in the belief that they were made on behalf of us or the Company,
nor have you relied on the absence of any representations, warranties,
agreements, or statements in reaching your discussion to buy the
Notes. Rather, you have made your own independent determination to
buy the Notes and their value.
(c) Potential
Changes in Value. You
understand that the Notes may increase in value as a result of improvements
in
the Company’s operating performance, the recapitalization of the Company, any
merger or acquisition activity involving the Company, or other reasons and
that
our affiliates may play a role in any such events or transactions, which
would
benefit them personally as holders of the Notes.
6. Your
Further Acknowledgments. You
as buyer acknowledge as follows:
(a) Ability
to Bear Risk; Business and Financial Knowledge and
Experience. You
can bear the economic risk of the purchase of the Notes, including the complete
loss of your investment, and you have sufficient knowledge and experience
in
business and financial matters as to be capable of evaluating the merits
and
risks of your purchase of the Notes.
(b) Knowledge
Respecting the Company. You
(i) know or have had the opportunity to acquire all information concerning
the
business, affairs, financial condition, plans, and prospects of the Company
that
you deem relevant to make a fully informed decision respecting the purchase
of
the Notes, (ii) have had the opportunity to rely upon the advice of your
legal
counsel and accountants and other advisers with respect to the purchase of
the
Notes; and (iii) have had the opportunity to ask such questions and receive
such
information and answers respecting, among other things, the business, affairs,
financial condition, plans and prospects of the Company and the terms and
conditions of the purchase of the Notes as you have requested so as to more
fully understand our investment.
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(c) Absence
of Representations and Warranties. Other
than as specifically set forth herein, you acknowledge that neither we nor
anyone purportedly acting on our behalf has made any representations,
warranties, agreements, or statements other than those contained herein
respecting the business, affairs, financial condition, plans or prospects
of the
Company nor have you relied on any representations, warranties, agreements,
or
statements in the belief that they were made on behalf of any of the foregoing
nor have you relied on the absence of any such representations, warranties,
agreements, or statements in reaching your decision to purchase the
Notes.
(d) No
Distribution. You
are acquiring the Notes for your own account without a view to public
distribution or resale, and you have no contract, undertaking, agreement,
or
arrangement to transfer, sell, or otherwise dispose of any Notes or any interest
therein to any other person.
(e) Shares
to be Restricted. You
understand that the Notes are “restricted securities” within the meaning of Rule
144 under the Securities Act of 1933, as amended (the “1933 Act”).
(f) No
Registration. You
understand that the Notes have not been registered under the 1933 Act or
the
securities laws of any other jurisdiction and must be held indefinitely without
any transfer, sale, or other disposition unless the Notes are subsequently
registered under the 1933 Act and the securities laws of any other applicable
jurisdictions or, in the opinion of counsel for the Company, registration
is not
required under such acts or laws as the result of an available
exemption.
(g) No
Obligation to Register. You
understand that (i) the Company is under no obligation to register the Notes
under the 1933 Act or the securities laws of any other jurisdiction or to
take
any action which would make available any exemption from such registration
and
(ii) you therefore may be precluded from transferring, selling, or otherwise
disposing of any Notes or any interest therein for an indefinite period of
time
or at any particular time.
(h) Legend
on Notes. You
understand that there shall be endorsed as restrictive legend on the
Notes.
7. The
Closing. The
Closing under this Agreement shall take place through an escrow arrangement
or
in such other manner as may be agreed upon by each of us in
writing. At the Closing, you will deliver the Notes to us, and we
will deliver the purchase price of the Notes to you. The deliveries
by either of us shall constitute a representations that all of the
representations, warranties, and acknowledgments by the delivering party
has
been true and correct at all times between the date of this Agreement and
the
Closing. Notwithstanding the foregoing, we understand that there may
be multiple closings as the various are placed in escrow.
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8. Further
Assurances. Each
of us shall execute and deliver all such other instruments and take all such
other action as either of us may reasonably request from time to time in
order
to effectuate the transactions provided for herein.
9. Mutual
Releases. Each
party (“Releasor”) hereto hereby releases and forever discharges each other
party and the Company (a “Releasee”) and each Releasee’s successors, assigns,
directors, and officers from all actions, suits, causes of action,
controversies, contracts, agreements, judgments, and claims whatsoever in
law or
equity (excepting only this Agreement) that against a Releasee or a Releasee’s
successors, assigns, directors, or officers, Releasor ever had, now has,
or
which ▇▇▇▇▇▇▇▇’s successors or assigns hereafter can, shall, or may have by
reason of any cause, matter, or thing since the beginning of time.
10. Miscellaneous.
(a) Controlling
Law. This
Agreement and all questions relating to its validity, interpretation,
performance and enforcement, will be governed by and construed in accordance
with the laws of the state of Nevada, notwithstanding any Nevada or other
conflict-of-law provisions to the contrary.
(b) Binding
Nature of Agreement; No Assignment.
This
Agreement shall be binding upon and inure to the benefit of each of us and
our
respective heirs, personal representatives, successors, and assigns, except
that
neither of us may assign or transfer any rights or obligations under this
Agreement without prior written consent of the other.
(c) Entire
Agreement. This
Agreement contains the entire understanding between each of us with respect
to
the subject matter hereof, and supersedes all prior and contemporaneous
agreements and understandings, inducements or conditions, express or implied,
oral or written, except as herein contained.
(d) Paragraph
Headings. The
paragraph headings in this Agreement are for convenience only, they form
no part
of this Agreement and shall not affect its interpretation.
If
the
foregoing is satisfactory and you wish to acquire the Shares subject to the
terms and conditions set forth herein, would you so indicate by signing and
returning a copy of this letter to me.
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Very
truly yours,
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By:
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ACCEPTED
AND APPROVED:
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By:
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SCHEDULE
A
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Note
Principal Amount
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Sale
Price
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