EXHIBIT 10.27
JOINT VENTURE AGREEMENT
TERM SHEET
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PURPOSE: Design, development, manufacturing and wholesale
distribution of the "Life and Death" apparel line.
(the "Product Line")
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PARTIES: Blue Holdings, Inc. ("BLHL") - 50% membership
interest Xxxxxxxx Xxxxxx ("PN") - 25% membership
interest Alex Caugant ("AC") - 25% membership
interest
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INITIAL CAPITAL PN and AC have invested an undetermined amount for
CONTRIBUTION: the initial development and launch of the Product
Line, which, once determined, shall be considered as
their collective Initial Capital Contribution. As its
Initial Capital Contribution, BLHL will contribute
the same amount, and the BLHL contribution may be
used as working capital.
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ADDITIONAL CAPITAL: The Operating Agreement of Newco shall contain a
mechanism for "Additional Capital Calls".
Notwithstanding the foregoing, no member shall be
required to contribute additional capital and no
members percentage interest shall be diluted by such
member's refusal to contribute additional capital.
Each such Additional Capital Call shall require the
unanimous consent of the members, and any such
contributions shall be made by the members in
accordance with their respective membership
interests. Prior to making a capital call, the
managers shall meet in good faith to determine the
necessity and the amount of any such call.
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In the event that additional working capital is
needed, but the members do not wish to make an
Additional Capital Call, then any member may, but
shall not be required to, lend funds to Newco, which
such loan shall be evidenced by a promissory note
with interest payable at prime plus 1% and which
shall contain other standard terms and conditions,
all of which must be approved by the managers.
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PROFITS & LOSSES: The members shall share profits and losses in
accordance with their percentage interests..
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COMPANY MANAGEMENT: PN and Xxxx Xxxx will serve as the
managers of Newco. PN shall be responsible for
managing all day to day operations of the business,
for hiring and supervising personnel and all
operations relating to Newco's business, including
production, accounting, design and development and
administration.
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BUDGET: The managers shall prepare and adopt an annual
budget. Any expenses outside the budget shall require
the consent of both managers. All payroll, insurance,
advertising, development, production and other
overhead costs shall be projected in the budget.
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SALARIES: PN and AC shall enter into employment agreements with
Newco, pursuant to which they shall provide fashion
design services for the Product Line, and for which
they will each be compensated for the first six
months at the rate of $15,000 per month, and
thereafter at the rate of $25,000 per month. rate of
$300 000 per year.
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TRADEMARK: The "Life & Death" trademark application, Serial No
78880036 which is pending before the United States
Patent and Trademark Office shall be irrevocably
assigned by PN to Newco.
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MISCELLANEOUS: The existing employment agreements between Antik
Denim, LLC, PN and AC (as amended) shall be further
amended to permit (a) PN and AC to enter into an
employment agreement with, and to provide services to
Newco; (b) to provide a salary adjustment effective
six (6) months following the inception of this
agreement, whereby the salaries payable to PN and AC
by Antik Denim, LLC shall be reduced from the present
$20,000 each per month to $10,000 each per month; and
(c) to amend Section 17 of the Employment Agreement
to read as follows:
17. TERMINATION BY EMPLOYEE.
If Employer ceases conducting its business,
takes any action looking toward its dissolution or
liquidation, makes an assignment for the benefit of
its creditors, admits in writing its inability to pay
its debts as they become due, files a voluntary, or
becomes the subject of an involuntary petition in
bankruptcy, becomes the subject of any state or
federal insolvency proceeding of any kind, or
otherwise materially breaches this Agreement, then
the Employee, in the Employee's sole discretion, by
written notice to the Employer, may terminate the
employment, and the Employer consents to the
Employee's release under such circumstances; and in
the case of a material breach by Employer or if the
Employer ceases to operate or exist as a result of
such event, the provisions of paragraph 18 of this
Agreement will not survive the termination.
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AGREED AND ACCEPTED:
/S/ XXXXXXXX XXXXXX
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Xxxxxxxx Xxxxxx
/S/ ALEXANDRE CAUGANT
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Alexandre Caugant
BLUE HOLDINGS, INC.:
/S/ XXXX XXXX
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By: Xxxx Xxxx, C.E.O
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