Exhibit 10.2
LICENSING AGREEMENT
By and Among
AMERICAN HYGIENICS CORPORATION
A Privately-Owned Corporation Incorporated and
Governed by the Republic of China,
GREEN HYGIENICS, INC.
A Corporation Incorporated in the State of Florida
Dated as of August 1, 2012
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LICENSING AGREEMENT
THIS LICENSING AGREEMENT (this "Agreement") is entered into as of this 1st
day of AUGUST, 2012 by and between GREEN HYGIENICS, INC. ("GHI"), a Florida
Corporation; and AMERICAN HYGIENICS CORPORATION ("AHC"), a corporation domiciled
in the People's Republic of China.
Recitals
WHEREAS, shareholders of AHC agree to license its products holding
Intellectual Passport on bamboo pulp-based hygiene products manufacturing to
GHI, in exchange for the fees as negotiated through a markup to the wholesale
price. The initial list of products to be provided by AHC are disclosed on
Exhibit A.
WHEREAS, GHI will have a North American exclusive with AHC for the bamboo
products listed in Exhibit A for a period of five (5) years. At the expiry of
five years and the conditions set forth being met, there will be an automatic
renewal for a minimum of five (5) years. This Agreement shall remain contracted
with GHI and will not be assigned to the parent company post-Reverse Merger
unless approved by both parties. Certain conditions, as stated in Exhibit A,
including certain levels of annual sales for stated products, will be required
for Agreement. Additionally, certain requirements related to each SKU are stated
in Exhibit A.
NOW THEREFORE, on the stated premises and for and in consideration of the
mutual covenants and agreements hereinafter set forth and the mutual benefits to
the parties to be derived here from, and intending to be legally bound hereby,
it is hereby agreed as follows:
I.
REPRESENTATIONS, COVENANTS, AND WARRANTIES OF GHI
GHI hereby represents and warrants as follows:
1. Organization.
GHI is a corporation duly organized, validly existing, and in good standing
under the laws of the State of Florida and has the corporate power and is duly
authorized under all applicable laws, regulations, ordinances, and orders of
public authorities to carry on its business in all material respects as it is
now being conducted. Included in the GHI due diligence materials previously
submitted, are complete and correct copies of the articles of incorporation, and
bylaws of GHI as in effect on the date hereof. The execution and delivery of
this Agreement does not, and the consummation of the transactions contemplated
hereby will not, violate any provision of GHI's articles of incorporation or
bylaws. GHI has taken all actions required by law, its articles of
incorporation, or otherwise to authorize the execution and delivery of this
Agreement. GHI has full power, authority, and legal right and has taken all
action required by law, its articles of incorporation, and otherwise to
consummate the transactions herein contemplated.
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2. Non-Compete. During the term of this Agreement, GHI will not compete
with AHC and related entities.
3. Options or Warrants. There are no existing options, warrants, calls, or
commitments of any character relating to the authorized and unissued stock of
GHI.
4. Litigation and Proceedings. There are no actions, suits, proceedings, or
investigations pending or, to the knowledge of GHI, threatened against GHI, at
law or in equity, before any court or other governmental agency or
instrumentality, domestic or foreign, or before any arbitrator of any kind. GHI
does not have any knowledge of any material default on its part with respect to
any judgment, order, injunction, decree, award, rule, or regulation of any
court, arbitrator, or governmental agency or instrumentality or of any
circumstances which would result in the discovery of such a default.
5. No Conflict With Other Instruments. The execution of this Agreement and
the consummation of the transactions contemplated by this Agreement will not
result in the material breach of any term or provision of, constitute a default
under, or terminate, accelerate or modify the terms of any material indenture,
mortgage, deed of trust, or other material agreement or instrument to which GHI
is a party or to which any of its assets, properties or operations are subject.
6. Compliance With Laws and Regulations. To the best of its knowledge, GHI
has complied with all applicable statutes and regulations of any federal, state,
or other governmental entity or agency thereof, except to the extent that
noncompliance would not materially and adversely affect the business,
operations, properties, assets, or condition of GHI or except to the extent that
noncompliance would not result in the occurrence of any material liability for
GHI. This compliance includes, but is not limited to, the filing of all reports
to date with federal and state securities authorities.
7. Approval of Agreement. The Board of Directors of GHI has authorized the
execution and delivery of this Agreement by GHI and has approved this Agreement
and the transactions contemplated hereby. This Agreement shall be subject to
approval of GHI in accordance with the laws of the State of Florida, including
any preemptive or dissenters rights under such State's laws.
8. Valid Obligation. This Agreement and all agreements and other documents
executed by GHI in connection herewith constitute the valid and binding
obligation of GHI, enforceable in accordance with its or their terms, except as
may be limited by bankruptcy, insolvency, moratorium or other similar laws
affecting the enforcement of creditors' rights generally and subject to the
qualification that the availability of equitable remedies is subject to the
discretion of the court before which any proceeding therefore may be brought.
9. GHI will take charge of all sales and marketing within the territory of
all the brands and products listed in exhibit A to its best capacity and will
assume all the expenses incurred in regards to the sales of the products
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II.
REPRESENTATIONS, COVENANTS, AND WARRANTIES OF AHC
AHC hereby represents and warrants as follows:
1. Organization. AHC is a corporation duly organized, validly existing, and
in good standing under the laws of PEOPLE'S REPUBLIC OF CHINA and has the
corporate power and is duly authorized under all applicable laws, regulations,
ordinances, and orders of public authorities to carry on its business in all
material respects as it is now being conducted. Included in the AHC due
diligence materials submitted herewith, are complete and correct copies of the
certificate of incorporation and bylaws of AHC as in effect on the date hereof.
The execution and delivery of this Agreement does not, and the consummation of
the transactions contemplated hereby will not, violate any provision of AHC's
certificate of incorporation or bylaws. AHC has taken all action required by
law, its certificate of incorporation, its bylaws, or otherwise to authorize the
execution and delivery of this Agreement, and AHC has full power, authority, and
legal right and has taken all action required by law, its certificate of
incorporation, bylaws, or otherwise to consummate the transactions herein
contemplated.
2. Not Used.
3. Not Used.
4. Information. The information concerning AHC provided in the due
diligence materials and as set forth in this Agreement is complete and accurate
in all material respects and does not contain any untrue statements of a
material fact or omit to state a material fact required to make the statements
made, in light of the circumstances under which they were made, not misleading.
5. Litigation and Proceeding. There are no actions, suits, or proceedings
pending or, to the knowledge of AHC after reasonable investigation, threatened
by or against AHC or affecting AHC or its properties, at law or in equity,
before any court or other governmental agency or instrumentality, domestic or
foreign, or before any arbitrator of any kind. AHC has no knowledge of any
default on its part with respect to any judgment, order, writ, injunction,
decree, award, rule or regulation of any court, arbitrator, or governmental
agency or instrumentality or any circumstance, which after reasonable
investigation would result in the discovery of such default.
6. Contracts. AHC is not a party to, and its assets, products, technology
and properties are not bound by, any contract, franchise, license agreement,
agreement, debt instrument or other commitments whether such agreement is in
writing or oral which would impede or prevent entry into, performance of, or due
enforcement of this Agreement.
7. No Conflict With Other Instruments. The execution of this Agreement and
the consummation of the transactions contemplated by this Agreement will not
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result in the breach of any term or provision of, constitute a default under, or
terminate, accelerate or modify the terms of, any indenture, mortgage, deed of
trust, or other material agreement or instrument to which AHC is a party or to
which any of its assets, properties or operations are subject.
8. Compliance With Laws and Regulations. To the best of its knowledge, AHC
has complied with all applicable statutes and regulations of federal, state, or
other applicable governmental entity or agency thereof, relevant in its
compliance to labeling and approvals of their products to be sold within the
laws of the market its being sold to as this remains its obligation for branded
and private label products.
9. Approval of Agreement. The Board of Directors of AHC has authorized the
execution and delivery of this Agreement by AHC and has approved this Agreement
and the transactions contemplated hereby.
10. Valid Obligation. This Agreement and all agreements and other documents
executed by AHC in connection herewith constitute the valid and binding
obligation of AHC, enforceable in accordance with its or their terms, except as
may be limited by bankruptcy, insolvency, moratorium or other similar laws
affecting the enforcement of creditors' rights generally and subject to the
qualification that the availability of equitable remedies is subject to the
discretion of the court before which any proceeding therefore may be brought.
III.
SPECIAL COVENANTS
1. Closing. The closing of the transactions contemplated by this Agreement
(the "Closing") shall occur no later than August 5, 2012, or as otherwise
mutually agreed to by the parties hereto.
2. Not Used.
3. Termination. This Agreement may be terminated by the Board of Directors
of GHI only in the event that the conditions precedent set forth in this
Agreement are not satisfied. This Agreement may be terminated by the Board of
Directors of AHC only in the event that the conditions precedent set forth are
not satisfied. If this Agreement is terminated there shall be of no further
force or effect, and no obligation, right or liability shall arise hereunder.
The termination is required to be provided by either party to the other party
with a 90 days' written notice. Should either party terminate the Agreement for
cause, the prevailing party shall have the rights to the customers and/or
accounts of GHI.
4. Not Used
5. Third Party Consents and Certificates. AHC and GHI agree to cooperate
with each other in order to obtain any required third party consents to this
Agreement and the transactions herein contemplated.
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6. Obligations of Both Parties.
From and after the date of this Agreement until the termination of the
Agreement and, except as expressly permitted or contemplated by this Agreement,
AHC and GHI respectively, will each:
i. carry on its business in substantially the same manner as it has
heretofore;
ii. maintain in full force and effect insurance comparable in amount
and in scope of coverage to that now maintained by it;
iii. use its best efforts to maintain and preserve its business
organization intact, to retain its key employees, and to maintain its
relationship with its material suppliers and customers; and
iv. fully comply with and perform in all material respects all
obligations and duties imposed on it by all federal and state laws and all
rules, regulations, and orders imposed by federal or state governmental
authorities.
7. Indemnification.
GHI hereby agrees to indemnify AHC and each of the officers, agents and
directors of AHC as of the date of execution of this Agreement against any loss,
liability, claim, damage, or expense (including, but not limited to, any and all
expense whatsoever reasonably incurred in investigating, preparing, or defending
against any litigation, commenced or threatened, or any claim whatsoever)
("Loss"), to which it or they may become subject arising out of or based on any
inaccuracy appearing in or misrepresentations made under Article I of this
Agreement. The indemnification provided for in this paragraph shall survive the
Closing and consummation of the transactions contemplated hereby and termination
of this Agreement for one year following the Closing. AHC hereby agrees to
indemnify GHI and each of the officers, agents, and directors of GHI and the GHI
Shareholders as of the date of execution of this Agreement against any Loss to
which it or they may become subject arising out of or based on any inaccuracy
appearing in or misrepresentation made under Article II of this Agreement. The
indemnification provided for in this paragraph shall survive the Closing and
consummation of the transactions contemplated hereby and termination of this
Agreement for one year following the Closing.
IV.
CONDITIONS PRECEDENT TO OBLIGATIONS OF AHC
The obligations of AHC under this Agreement are subject to the
satisfaction, at or before the Closing Date, of the following conditions:
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1. Accuracy of Representations and Performance of Covenants. The
representations and warranties made by GHI and the GHI Shareholders in this
Agreement shall be true in all material respects (other than representations and
warranties which contain materiality standards, which representations and
warranties shall be true and correct in all respects) at and as of the Closing
Date (except for changes therein permitted by this Agreement). GHI shall have
performed or complied with, in all material respects, all covenants and
conditions required by this Agreement to be performed or complied with by GHI
prior to or at the Closing. AHC shall be furnished with a certificate, signed by
a duly authorized executive officer of GHI and dated the Closing Date, to the
foregoing effect.
2. Officer's Certificate. AHC shall have been furnished with a certificate
dated the Closing Date and signed by a duly authorized officer of GHI to the
effect that no litigation, proceeding, investigation, or inquiry is pending, or
to the best knowledge of GHI threatened, which might result in an action to
enjoin or prevent the consummation of the transactions contemplated by this
Agreement, or, which might result in any material adverse change in any of the
assets, properties, business, or operations of GHI.
3. No Governmental Prohibition. No order, statute, rule, regulation,
executive order, injunction, stay, decree, judgment or restraining order shall
have been enacted, entered, promulgated or enforced by any court or governmental
or regulatory authority or instrumentality which prohibits the consummation of
the transactions contemplated hereby.
4. Consents. All consents, approvals, waivers or amendments pursuant to all
contracts, licenses, permits, trademarks and other intangibles in connection
with the transactions contemplated herein, or for the continued operation of GHI
after the Closing Date on the basis as presently operated shall have been
obtained.
V.
CONDITIONS PRECEDENT TO OBLIGATIONS OF GHI
The obligations of GHI under this Agreement are subject to the
satisfaction, at or before the Closing Date, of the following conditions:
1. Accuracy of Representations and Performance of Covenants. The
representations and warranties made by AHC in this Agreement shall be true in
all material respects (other than representations and warranties which contain
materiality standards, which representations and warranties shall be true and
correct in all respects) at and as of the Closing Date. Additionally, AHC shall
have performed and complied, in all material respects, with all covenants and
conditions required by this Agreement to be performed or complied with by AHC.
2. Officer's Certificate. GHI shall have been furnished with certificates
dated the Closing Date and signed by duly authorized executive officers of AHC,
to the effect that no litigation, proceeding, investigation or inquiry is
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pending, or to the best knowledge of AHC threatened, which might result in an
action to enjoin or prevent the consummation of the transactions contemplated by
this Agreement or, to the extent not disclosed in the AHC's filings with the
Securities and Exchange Commission, by or against AHC, which might result in any
material adverse change in any of the assets, properties or operations of AHC.
3. Good Standing. GHI shall have received a certificate of good standing
from the Secretary of State of the State of Florida or other appropriate office,
dated as of a date within ten days prior to the Closing Date certifying that GHI
is in good standing as a corporation in the State of Florida and has filed all
tax returns required to have been filed by it to date and has paid all taxes
reported as due thereon.
4. No Governmental Prohibition. No order, statute, rule, regulation,
executive order, injunction, stay, decree, judgment or restraining order shall
have been enacted, entered, promulgated or enforced by any court or governmental
or regulatory authority or instrumentality which prohibits the consummation of
the transactions contemplated hereby.
5. Consents. All consents, approvals, waivers or amendments pursuant to all
contracts, licenses, permits, trademarks and other intangibles in connection
with the transactions contemplated herein, or for the continued operation of AHC
after the Closing Date on the basis as presently operated shall have been
obtained.
VI.
MISCELLANEOUS
1. Governing Law. This Agreement shall be governed by, enforced, and
construed under and in accordance with the laws of Hong Kong. Venue for all
matters shall be in Hong Kong, without giving effect to principles of conflicts
of law thereunder. Each of the parties (a) irrevocably consents and agrees that
any legal or equitable action or proceedings arising under or in connection with
this Agreement shall be brought exclusively in by Hong Kong International
Arbitration Center (HKIAC). By execution and delivery of this Agreement, each
party hereto irrevocably submits to and accepts, with respect to any such action
or proceeding, generally and unconditionally, the jurisdiction of the aforesaid
court, and irrevocably waives any and all rights such party may now or hereafter
have to object to such jurisdiction.
2. Notices. Any notice or other communications required or permitted
hereunder shall be in writing and shall be sufficiently given if personally
delivered to it or sent by telecopy, overnight courier or registered mail or
certified mail, postage prepaid, addressed as follows:
If to GHI: ▇▇▇▇▇ ▇▇▇▇▇▇,
Chief Executive Officer
▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇.▇▇▇▇▇@▇▇▇▇▇.▇▇▇
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With a copy to:
If to AHC: American Hygienics Corporation
Attn ▇▇▇▇ ▇▇▇▇▇▇
▇▇.▇, ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇,▇▇▇▇▇▇▇
▇▇▇▇,▇▇▇▇▇▇▇▇▇,▇▇▇▇▇▇▇▇, China
Zip: 201602
Tel :▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
With a copy to:
For such other addresses as shall be furnished in writing by any party in the
manner for giving notices hereunder, and any such notice or communication shall
be deemed to have been given (i) upon receipt, if personally delivered, (ii) on
the day after dispatch, if sent by overnight courier, (iii) upon dispatch, if
transmitted by telecopy and receipt is confirmed by telephone and (iv) three (3)
days after mailing, if sent by registered or certified mail.
3. Attorney's Fees. In the event that either party institutes any action or
suit to enforce this Agreement or to secure relief from any default hereunder or
breach hereof, the prevailing party shall be reimbursed by the losing party for
all costs, including reasonable attorney's fees, incurred in connection
therewith and in enforcing or collecting any judgment rendered therein.
4. Confidentiality. Each party hereto agrees with the other that, unless
and until the transactions contemplated by this Agreement have been consummated,
it and its representatives will hold in strict confidence all data and
information obtained with respect to another party or any subsidiary thereof
from any representative, officer, director or employee, or from any books or
records or from personal inspection, of such other party, and shall not use such
data or information or disclose the same to others, except (i) to the extent
such data or information is published, is a matter of public knowledge, or is
required by law to be published; or (ii) to the extent that such data or
information must be used or disclosed in order to consummate the transactions
contemplated by this Agreement. In the event of the termination of this
Agreement, each party shall return to the other party all documents and other
materials obtained by it or on its behalf and shall destroy all copies, digests,
work papers, abstracts or other materials relating thereto, and each party will
continue to comply with the confidentiality provisions set forth herein.
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5. Third Party Beneficiaries. This contract is strictly between AHC and
GHI, and, except as specifically provided, no director, officer, stockholder,
employee, agent, independent contractor or any other person or entity shall be
deemed to be a third party beneficiary of this Agreement.
6. Expenses. Subject to this Agreement, each of AHC and GHI will bear their
own respective expenses, including legal, accounting and professional fees,
incurred in connection with this transaction contemplated hereby.
7. Entire Agreement. This Agreement represents the entire agreement between
the parties relating to the subject matter thereof and supersedes all prior
agreements, understandings and negotiations, written or oral, with respect to
such subject matter.
8. Survival; Termination. The representations, warranties, and covenants of
the respective parties shall survive the Closing Date and the consummation of
the transactions herein contemplated for a period of one year.
9. Counterparts. This Agreement may be executed in multiple counterparts,
each of which shall be deemed an original and all of which taken together shall
be but a single instrument.
10. Amendment or Waiver. Every right and remedy provided herein shall be
cumulative with every other right and remedy, whether conferred herein, at law,
or in equity, and may be enforced concurrently herewith, and no waiver by any
party of the performance of any obligation by the other shall be construed as a
waiver of the same or any other default then, theretofore, or thereafter
occurring or existing. At any time prior to the Closing Date, this Agreement may
by amended by a writing signed by all parties hereto, with respect to any of the
terms contained herein, and any term or condition of this Agreement may be
waived or the time for performance may be extended by a writing signed by the
party or parties for whose benefit the provision is intended.
11. Best Efforts. Subject to the terms and conditions herein provided, each
party shall use its best efforts to perform or fulfill all conditions and
obligations to be performed or fulfilled by it under this Agreement so that the
transactions contemplated hereby shall be consummated as soon as practicable.
Each party also agrees that it shall use its best efforts to take, or cause to
be taken, all actions and to do, or cause to be done, all things necessary,
proper or advisable under applicable laws and regulations to consummate and make
effective this Agreement and the transactions contemplated herein.
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IN WITNESS WHEREOF, the corporate parties hereto have caused this Agreement
to be executed by their respective officers, hereunto duly authorized, as of the
date first-above written.
Green Hygienics, Inc.,
A Florida Corporation
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Chief Executive Officer
American Hygienics Corporation,
A People's Republic of China WOFE -
wholly-owned Foreign entity
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: President and Authorized signatory
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EXHIBIT A
The following products under this Agreement to be provided to GHI exclusively
from AHC are as follows (additional products may be added from time to time and
are not required to be added as an addendum to this Agreement) for the North
American market only.
* Female Sanitary Pads made from bamboo pulp
* Panty Liners made from bamboo pulp
* Biodegradable diapers of 100% bamboo pulp
* TCF free bamboo pulp based plate and cups
* Produce platters and absorbents made from bamboo pulp
* Nursing pads made from bamboo pulp
* Under arm absorbing pads made from bamboo pulp
* Dryer sheet pads made from bamboo viscous fiber
* Divers stationary 100% tree free
Products transacted between GHI and AHC beyond this scope of Exhibit A may not
be exclusive to GHI. All other products offered by AHC are available to GHI on a
non-exclusive basis for the North American retail and institutional market only.
GHI will only promote products made and/or sourced by AHC or its related
entities in regards to products made containing pulp, paper, non-wovens, and/or
surfactants. GHI can promote other products from other manufacturers not
containing any of these components.
Target Sales for the licensing requirements for bamboo pulp based hygiene
product. Commencement of time starts upon clearance for marketing by AHC and
submission to and receipt of samples by GHI.
1) Feminine Pads - US$150,000 for the first year, as defined within this
contract, and 25% growth per year for the second year forward.
a) Female Sanitary Pads made from bamboo Pulp
b) Panty Liners made from bamboo pulp
c) Diapers made from bamboo pulp
2) Miscellaneus products - US$100,000 for the first year, as defined
within this contract, and 25% growth per year for the second year
forward.
a) TCF free bamboo pulp-based plate and cups
b) Produce platters and absorbents made from bamboo pulp
c) Nursing pads made from bamboo pulp
d) Under arm absorbing pads made from bamboo pulp
e) Dryer sheet pads made from bamboo viscous fiber
f) Divers stationary 100% tree free
3) Miscellaneous branded products - US$150,000 for the first year, as
defined within this contract, and 25% growth per year for the second
year forward
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a) All products with the trademark Premium Formulation
b) All products with the trademark Clearly Herbal, contingent on AHI
gaining exclusivity.
c) All products with the trademark Green & Soft
d) All products with the trademark GHI
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