Class 2 Assignment

Term Sheet Provision Operative Language in Agreement

1. Place lien on manufacturing As a precondition to the agreement,
equipment and accounts receivable, Party A and Party shall draft and sign
under New York law an agreement granting Party A lien over
Party B's manufacturing equipment as
described in Schedule 1 of this
Agreement, and accounts receivable as
described in Schedule 2 of this
Agreement under New York law.
2. License under IP rights for JV entity Parties shall grant to each other, free of
to conduct business charge, a non-exclusive and non-
transferable rights and license of the
following intellectual property rights
for the purpose hereof during the term
of this Agreement.
3. Transfer of Japan trademark rights Party A hereby irrevocably assigns to
for retail operations Party B, all registration rights with
respect to the Party A’s Trademark A
for retail operations. hereunder.
4. Sublease part of office space Party A shall sublease to Party B a
portion of the premises in the building,
as provided in Exhibit A attached
hereto.
5. Secondment of 10 employees to joint Each party agrees to transfer 5 (five)
venture company for R&D work employees to JV Company for a period
of X months for R&D work.
6. Hire contractor for website work The JV shall hire an independent
contractor for website work, as
described in Exhibit B.
7. Release of all claims under an Notwithstanding any other provision
agreement hereof to the contrary, the parties
waive, release and promise never to
assert any claims or causes of action
hereunder against each other.
8. Appoint an exclusive sales rep for Parties A and B hereby appoint
Asia Representative AJohn Smith as an the
JV’s exclusive sales representative for
for Asia of JV..
9. Protect/hold harmless Party A Party A shall be indemnified, defended
against third party claims for IP and held harmless by Party B from and
infringement against any and all third party claims
liabilities, judgments, settlements,
penalties, fines, costs or expenses,
 including reasonable attorneys’ fees,
arising in connection with infringement
of patents, trademarks, utility models,
designs, copyrights, trade secrets or
any other intellectual property rights,
whether in the Party B’s A’s country or
not.
10. Customer to receive MFN treatment JV represents and warrants that the
for pricing and allocation in case of price for the goods is the lowest price
supply constraints charged by it to any of its external
buyers for similar volumes of similar
goods. Moreover, JV represents and
warrants that its allocation of supply
shall be made equal to both customers
originating from the JV country and
customers originating from foreign
countries. If JV charges any other buyer
a lower price, it must apply that price to
all goods under an order. Conversely, JV
should allocate equal volume of its
supply to all its customers
notwithstanding the country they
originate. If JV fails to meet the lower
price or fails to allocate equal volume of
its supply, Customer, at its option, may
terminate such order without liability
pursuant to Section xx.
11. Right of first refusal over all share 1. A party hereto proposing to a sale of
transfer to third parties any shares of JV (the “Offeror”) shall
give a written notice to the other party
hereto (the”Offeree”), the identity of
the prospective third party purchaser,
and the terms and conditions of the
proposed sale (the “Proposed Sale”)
and shall make a written offer (the
“Offer”) to sell the shares of JV in
question to the Offeree (pro rata, in
accordance with the Offerees’
shareholdings in JV), on the identical
terms and conditions of the Proposed
Sale, including, but not limited to the
purchase price and terms of payment.
2. Acceptance by Offerees of any Offer
that has been made to it purchase to
section 1 will be effective upon the
 giving by an Offeree of written notice of
acceptance within X days after the
Offeror’s receipt of the Offer.
12. Party A will not say bad things Party A shall not harm the reputation of
about Party B Party B.Party A agrees that Party A
shall not disparage, criticize or defame
Party B, its affiliates and their
respective affiliates, directors, officers,
agents, partners, stockholders or
employees, either publicly or privately.
Party A agrees that it shall not, and it
shall instruct its officers and members
of its Board to not, disparage, criticize
or defame Party B, either publicly or
privatley.