LICENSING / PURCHASE AGREEMENT
Dated as of March 15, 2004
Among
THE CHELSEA COLLECTION
and
GATEWAY DISTRIBUTORS LTD
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THIS AGREEMENT ("Agreement"), dated as of March 15, 2004 , is by and among
Gateway Distributors Ltd, a Nevada Corporation (the "Purchaser") and The Chelsea
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Collection Inc, a Nevada corporation ("Seller")
RECITALS
A. The "Seller" has the right to purchase all of the rights, trademarks,
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and formulas of all the Jeunesse products exclusively upon satisfactory
completion of all obligations owed to Xxxxxxxx Xxxxxxx in agreement dated
November 25, 2003.
B. The parties hereto wish to provide for the terms and conditions upon
which the "Purchaser" will acquire the exclusive licensing rights to the
Jeunesse products.
C. The parties hereto wish to make certain representations, warranties,
covenants and agreements in connection with the licensing agreement, also to
prescribe various conditions to such transaction.
AGREEMENT
Accordingly, and in consideration of the representations, warranties,
covenants, agreements and conditions herein contained, the parties hereto agree
as follows:
ARTICLE 1
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PURCHASE AND SALE OF ASSETS
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1. Assets to be Purchased. Upon satisfaction of all conditions to the
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obligations of the parties contained herein to Xxxxxxxx Xxxxxxx as set forth in
the Agreement dated Nov. 25, 2003, (other than such conditions as shall have
been waived in accordance with the terms hereof), the "Seller" shall sell,
transfer, convey, assign and deliver to the Purchaser, and the Purchaser shall
purchase from the "Seller", at the closing (as hereinafter defined), all of the
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"Sellers" rights, to the Jeunesse products.
a. Licensing rights of the Jeuness product line included shall be conveyed
free and clear of any mortgage, pledge, lien, security interest, encumbrance,
claim, easement, right-of-way, tenancy, covenant, encroachment, restriction or
change of any kind or nature. (Whether or not of record) This will only be the
case once the obligations to Xxxxxxxx Xxxxxxx set forth in the Agreement dated
November 25, 2003 have been totally satisfied.
2. Purchase Price. The "Purchaser" shall pay for the "Seller's Assets the
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following consideration (the "Purchase Price"):
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a. Inventory Stream. The "Purchaser" shall bear the burden of all costs
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of acquiring inventory of products.
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b. Revenue Payment. "Seller" will receive 15% of all revenues, minus cost
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of goods, generated by the Jeuness product line. The Chelsea Collection will be
the company receiving all payments outlined in the November 25, 2003 agreement
minus the individual payments made to Xxxxxxxx Xxxxxxx.
(i) Once the debt owed to Xxxxxxxx Xxxxxxx from the agreement dated
November 25, 2003 is paid in full, the 15% commissions paid by Gateway
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to Chelsea Collections shall remain in the Chelsea Collection minus
the 7% royalty paid to Xxxxxxx.
(ii) Commission of 7% of sales will continue for Xxxxxxxx Xxxxxxx as
outlined in the previous agreement dated November 25, 2003.
(iii) A good faith effort will be made to place The Chelsea Collection
into a shell and have it trading publicly once the revenues of the
company exceed $50,000 per month consistently for two months.
(iv) Xxxxxxxx Xxxxxxx will act as President / CEO of The Chelsea
Collection, Xxxxx Xxxxxx will act as Vice President of Marketing, and
Xxxx Xxxxxx will act as Vice President of Operations.
(v) Xxxxxxxx Xxxxxxx, along with Xxxx Xxxxxx and Xxx Xxxxxx, will all
three each own one third (1/3) of the Company, The Chelsea Collection.
All stock ownership by the three parties will be designated as
non-dilutable. Xxxxxxxx Xxxxxxx will have veto rights on all skin care
products and promotion material specifically related to the Jeunesse
by Francois product line.
(vi) This agreement will not in any way jeopardize any terms of the
Agreement dated November 25, 2003 between Xxxxxxxx Xxxxxxx and The
Chelsea Collection
(vii) In the event Seller or Purchaser sells its rights to the
Jeunesse products or the GH-3 PLUS products, to any other entity, or
in the event Purchaser sells substantially all of the stock in, or
assets of, Purchaser Corporation, Xxxxxxxx Xxxxxxx, Xxxx Xxxxxx and
Xxx Xxxxxx shall each receive one-third of the total proceeds of said
sale, applicable to the Jeunesse products and the GH-3PLUS products,
whether the proceeds are received in cash or in the stock of an
acquiring company.
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3. C1osing. Unless this Agreement shall have been terminated and the
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transactions contemplated herein shall have been abandoned, a closing will be
held on March 15, 2004 (the "Closing, Date"), provided, however, that if any of
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the conditions provided have not have been satisfiedor waived by such date, then
the party to this Agreement which is unable to satisfy such condition or
conditions, despite the best efforts of such party, shall be entitled to
postpone the Closing by notice to the other parties until such condition or
conditions shall have been satisfied (which such notifying party will seek to
cause to happen at the earliest practicable date) or waived, but in no event
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shall the Closing occur later than the 19th of March, 2004.
4. Corporate Organization. The "Purchaser" is validly existing and in good
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standing under the laws of the state of Nevada.
5. Authorization. The "Seller" has full corporate power and authority to enter
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into this Agreement and the "Seller" Delivered Documents and to carry out the
transactions contemplated herein and therein.
6. Intellectual Property Rights. The "Seller" has the right to purchase under
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the Nov. 25, 2003 Agreement, the industrial and intellectual property rights,
including without limitation the patents, patent applications, patent rights,
trademarks, trademark applications, trade names, service marks, service xxxx
applications, copyrights, computer programs and other computer software,
inventions, know-how, trade secrets, technology, proprietary processes and
formulae (collectively, "Intellectual Property Rights"). To the knowledge of the
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"Seller" the use of all Intellectual Property Rights necessary or required for
the conduct of the businesses of the "Seller" as presently conducted and as
proposed to be conducted does not and, to the knowledge of the "Seller" , will
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not infringe or violate or allegedly infringe or violate the intellectual
property rights of any person or entity. The "Seller" does not own or use any
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Intellectual Property Rights pursuant to any written license agreement, except
for the Nov. 25, 2003 Agreement with Xxxxxxxx Xxxxxxx, and has not granted any
person or entity any rights, pursuant to written license agreement or otherwise,
to use the Intellectual Property Rights.
7. The Purchaser has been made aware by Xxxxxxxx Xxxxxxx "Xxxxxxx" of all
past and current law suites in reference to the product line and the GH3 therapy
and agrees that the Purchaser and its officers will not in the future commence
any legal action against "Xxxxxxx" pertaining to these issues and/or for any
contract or agreements in the past. "Xxxxxxx" will extend the same terms to the
Purchaser.
8. This Agreement excludes any rights to the GH 3 Therapy which the parties
are to negotiate in June of 2004, per the Nov. 25, 2003 Agreement.
9. Confidentiality. Each of the parties hereto agrees that it will not use,
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or permit the use of, any of the information relating to any other party hereto
furnished to it in connection with the transactions contemplated herein
("Information") in a manner or for a purpose detrimental to such other party or
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otherwise than in connection with the transaction, and
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that they will not disclose, divulge, provide or make accessible, or permit the
Disclosure of (collectively, "Disclose" or "Disclosure" as the case may be), any
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of the Information to any person or entity, other than their responsible
directors, officers, employees, investment advisors, accountants, counsel and
other authorized representatives and agents, except as may be required by
judicial or administrative process or, in the opinion of such party's regular
counsel, by other requirements of Law; provided, however, that prior to any
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Disclosure of any Information permitted hereunder, the disclosing party shall
first obtain the recipients' undertaking to comply with the provisions of this
subsection with respect to such information. The term "Information" as used
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herein shall not include any information relating to a party which the party
disclosing such information can show: (i) to have been in its possession prior
to its receipt from another party hereto; (ii) to be now or to later become
generally available to the public through no fault of the disclosing party;
(iii) to have been available to the public at the time of its receipt by the
disclosing party; (iv) to have been received separately by the disclosing party
in an unrestricted manner from a person entitled to disclose such information;
or (v) to have been developed independently by the disclosing party without
regard to any information received in connection with this transaction. Each
party hereto also agrees to promptly return to the party from who originally
received all original and duplicate copies of written materials containing
Information should the transactions contemplated herein not occur. A party
hereto shall be deemed to have satisfied its obligations to hold the Information
confidential if it exercises the same care as it takes with respect to its own
similar information.
10. Governing Law. This Agreement and the legal relations among the parties
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hereto shall be governed by and construed in accordance with the internal
substantive laws of the State of Nevada (without regard to the laws of conflict
that might otherwise apply) as to all matters, including without limitation
matters of validity, construction, effect, performance and remedies.
11. Arbitration. Any controversy or claim arising out of or relating to
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this Agreement, or the making, performance or interpretation thereof, including
without limitation alleged fraudulent inducement thereof, shall be settled by
binding arbitration in Las Vegas, Nevada by a panel of three arbitrators in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association. Judgment upon any arbitration award may be entered in any court
having jurisdiction thereof and the parties consent to the jurisdiction of the
courts of the State, of Nevada for this purpose.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the day and year first above written. This agreement will
supercede all previous agreements both written and verbal.
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"PURCHASER" "SELLER"
GATEWAY DISTRIBUTORS LTD THE CHELSEA COLLECTION, INC.
By____________________________ By_____________________________
Xxxx Xxxxxx Xxxxxxxx Xxxxxxx
President / CEO President / CEO
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Agreed to as Individuals:
Xxxx Xxxxxx
Xxxxxxxx Xxxxxxx
Xxx Xxxxxx
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