LICENSE AND SUPPLY AGREEMENT

Exhibit 10.1

L ICENSE AND S UPPLY A GREEMENT

This License and Supply Agreement (“Agreement”) is made on March 9, 2009 (“Effective Date”) by and between B IO K OOL LLC , an Arizona limited liability company (“BioKool”), and B ARE E SCENTUALS B EAUTY , I NC . , a California corporation (“Bare Escentuals”).

R ECITALS

W HEREAS , BioKool and Bare Escentuals are currently parties to a License and Supply Agreement, dated September 12, 2005, as amended (“Original Agreement”), pursuant to which BioKool has granted to Bare Escentuals both an exclusive license to BioKools’ proprietary mineral technology and an exclusive right to purchase certain ingredients based on such technology;

W HEREAS , the parties desire to replace the Original Agreement with this Agreement, pursuant to which BioKool will grant to Bare Escentuals both a limited exclusive license to BioKools’ proprietary mineral teachnology and a limited exclusive right to purchase certain ingredients based on such technology; and

WHEREAS , BioKool will manufacture for, and supply to, Bare Escentuals the BioKool proprietary ingredients;

In consideration of the covenants and obligations hereinafter set forth, and the mutual benefits to be derived hereunder, the parties agree as follows:

1. DEFINITIONS. Capitalized terms used in this Agreement have the meaning given in this Section 1 or in the section where such term is first defined.

1.1 “BioKool Mineral Technology” means the BioKool proprietary mineral technology, as further described in Exhibit A, the Licensed Patents, and all Improvements.

1.2 “Field of Use” means the field of ***.

1.3 “Gross Revenue” means the total amount of payments actually received by Bare Escentuals from third party customers as a result of the sale of Royalty-Bearing Licensed Products to such third parties.

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1.4 “Improvement” means any improvement, modification, upgrade, variation, or enhancement of any BioKool Mineral Technology.

1.5 “Licensed Ingredients” means any substance coming within the scope of any claim of the Licensed Patents and/or any substance that is proprietary to BioKool and manufactured pursuant to the BioKool Mineral Technology.

1.6 “Licensed Method” means any method or process that, if used or performed by Bare Escentuals without the license granted in Section 2.1, would infringe one or more claims of a Licensed Patent.

1.7 “Licensed Patents” means (a) those United States patents and patent applications owned by BioKool or in which BioKool has a licensable interest, including the patent application described in Exhibit A; (b) any and all patents issuing or claiming priority from any of such patents, including continuations, continuations-in-part, divisionals, reexaminations, and reissues thereof; and (c) foreign counterparts of the patents described in clauses (a) and (b).

1.8 “Licensed Products” means a product that is made into finished goods for commercial sale to consumers and that if made, used, imported, or sold by Bare Escentuals without the license granted in Section 2.1 would infringe one or more claims of a Licensed Patent.

1.9 “Net Revenue” means Gross Revenue less any (a) testers, co-op advertising, rebates or trade, cash or quantity discounts offered by Bare Escentuals; (b) taxes on sales (such as sales or use taxes) to the extent added to the sales price; (c) value added taxes when included as part of the sales price and not refunded to the third-party customer; (d) freight, insurance, and other transportation charges; and (e) amounts repaid or credited by reason of rejection, defects, or returns or because of retroactive price reductions.

1.10 “Royalty Bearing Licensed Product” means a Licensed Product that contains the Licensed Ingredients.

1.11 “Specifications” means the quality and chemical specifications for the Licensed Ingredients, as set out in Exhibit A.

2. GRANT OF LICENSE

2.1 Licensed Patents. Subject to the terms and conditions of this Agreement, BioKool grants to Bare Escentuals a worldwide, nonexclusive (except as set forth in Section 2.2), right and license, under all intellectual property rights in the BioKool Mineral Technology to (a) use, develop, make, have made, sell, offer to sell, and import Licensed Ingredients and Licensed Products, (b) use and perform any Licensed Method, and (c) use, reproduce, perform, and practice the BioKool Mineral Technology.

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2.2 Exclusivity. For a period of *** years from the Effective Date (“Exclusivity Period”), (a) the license granted in Section 2.1 shall be exclusive (even as to BioKool) in the Field of Use and (b) BioKool shall not sell the Licensed Ingredients to any third party for use or distribution in the Field of Use.

(a) Extension of Exclusivity. The Exclusivity Period shall automatically be extended for the duration of the then-remaining term of this Agreement upon the first to occur of the following: (i) the date on which annual aggregate gross revenues earned by Bare Escentuals as a result of the sale of Licensed Products in the Field of Use are greater than or equal to *** or (ii) the date on which Bare Escentuals elects to extend the Exclusivity Period by paying to BioKool a one-time payment of ***.

2.3 Duration of License. The license granted in Sections 2.1(a) and 2.1(b) shall remain in effect until all Licensed Patents have expired, been abandoned, or been ruled invalid or unenforceable in a final non-appealable decision by a court of competent jurisdiction.

2.4 Price of Licensed Products. This Agreement does not set or otherwise regulate or control the sales price of the Licensed Products, and Bare Escentuals shall establish such prices in its sole discretion.

2.5 Delivery. Within fifteen (15) days after the Effective Date, and thereafter promptly after any request from Bare Escentuals, BioKool shall deliver to Bare Escentuals all documentation for, and other tangible embodiments of, the BioKool Mineral Technology. In addition, BioKool shall provide to Bare Escentuals reasonable training to enable Bare Escentuals to use the BioKool Mineral Technology in accordance with this Agreement.

2.6 Ownership. Except for the rights granted in this Agreement, BioKool reserves and owns all right, title, and interest in and to the BioKool Mineral Technology.

3. SALE OF LICENSED INGREDIENTS

3.1 Purchase Orders. Bare Escentuals or its authorized manufacturing contractor may issue to BioKool, by mail, email, or facsimile transmission, written orders for Licensed Ingredients (each, a “Purchase Order”) from time to time. Each Purchase Order will specify (a) the type and quantity of Licensed Ingredient ordered; (b) the unit price of each Licensed Ingredient purchased as per pricing schedule on Exhibit A, and the total purchase price; (c) the required delivery dates; (d) the billing and ship-to addresses for the order; and (e) any special instructions requested by Bare Escentuals. BioKool shall accept each Purchase Order submitted in accordance with this Agreement if the requested delivery date for each such Purchase Order is submitted within the Lead Time. Unless otherwise agreed by the parties in writing, the “Lead Time” for the Licensed Ingredients is and shall be thirty (30) days. BioKool shall notify Bare Escentuals of the acceptance or rejection (including the reasons for rejection) of each Purchase Order within two (2) business days after receipt of the Purchase Order. If within such time period BioKool does not provide notice of acceptance or rejection to Bare Escentuals, then the Purchase Order shall be deemed accepted.

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3.2 Modification of Purchase Orders. Bare Escentuals shall have the right at any time, in its sole discretion and without penalty or liability, to modify or cancel any Purchase Order, including by increasing or decreasing the volume of Licensed Ingredients or changing the shipping date or ship-to address, by providing written notice to BioKool at least thirty (30) days prior to BioKool’s scheduled shipment date for the applicable Licensed Ingredients, as such date has been notified to Bare Escentuals by BioKool (“Scheduled Shipment Date”). If BioKool has not notified Bare Escentuals of the Scheduled Shipment Date for a given Purchase Order within two (2) days after BioKool’s receipt of such Purchase Order, Bare Escentuals shall have the right to modify or cancel such Purchase Order at any time upon notice to BioKool.

3.3 Delivery. BioKool will deliver Licensed Ingredients on the dates and in the quantities specified in each accepted Purchase Order. In the event of any delays to the scheduled delivery date, and without limiting Bare Escentuals’ other rights and remedies hereunder, BioKool will notify Bare Escentuals of such delay and work diligently to remedy such delay immediately. In the event of any delay in delivery of more than *** weeks, in addition to any other rights or remedies otherwise available, Bare Escentuals shall have the right to take any of the following actions: (a) cancel or reschedule the affected order in Bare Escentuals’ sole discretion without further liability under this Agreement; or (b) enforce the Purchase Order subject to revised pricing terms that are discounted by *** per each day that BioKool fails to make delivery, up to a maximum of *** of the total price for the items not shipped on-time. All shipments will be made DDP (Incoterms 2000) the shipping point designated by Bare Escentuals in the applicable purchase order, and title and risk of loss to the Licensed Ingredients shall pass to Bare Escentuals upon delivery to such shipping point. For the avoidance of doubt, no royalty shall be payable by Bare Escentuals as a result of the sale of Licensed Ingredients to Bare Escentuals by BioKool.

3.4 Acceptance. All Licensed Ingredients purchased and shipped hereunder are subject to acceptance by Bare Escentuals at the ship-to address designated in the Purchase Order. Bare Escentuals shall have thirty (30) days after delivery of any Licensed Ingredients to inspect and accept or reject such Licensed Ingredients (the “Acceptance Period”). Any Licensed Ingredients that are not rejected during the Acceptance Period are deemed accepted by Bare Escentuals. Acceptance of any Licensed Ingredients shall not preclude any subsequent claim with respect to such Licensed Ingredient under Section 7. If during the Acceptance Period, Bare Escentuals identifies any Licensed Ingredient that does not conform to the Specifications (“Nonconforming Product”), Bare Escentuals shall have the right, at its sole option, to (a) reject such Nonconforming Product, (b) require replacement of the Nonconforming Product, (c) accept the Nonconforming Product with an adjustment in price, or (d) return such Nonconforming Product for credit or refund. Any rejected Licensed Ingredients must be replaced by BioKool, at its expense, within seven (7) business days after the request of Bare Escentuals. Upon delivery of replacement Licensed Ingredients, Bare Escentuals shall accept or reject such replacement in accordance with this Section 3.4.

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4. FEES AND CONSIDERATION

4.1 Commencement Payments : Subject to the terms and conditions of this Agreement, Licensee shall pay BioKool *** within two (2) days of the Effective Date, *** within one hundred eighty (180) days of the Effective Date and *** within three hundred sixty-five (365) days of the Effective Date.

4.2 Royalty. As long as the license granted to Bare Escentuals in Section 2.1 is in effect, Bare Escentuals shall pay to BioKool a royalty on the annual aggregate, cumulative Net Revenue received by Bare Escentuals from the sale of Royalty-Bearing Licensed Products, at the royalty rates set out in Exhibit B. Payment of the royalties owed by Bare Escentuals will be due along with the report required in Section 4.2. Bare Escentuals shall be entitled to offset the amount of any royalty due hereunder with any amount that is payable by BioKool to Bare Escentuals under Section 6.3.

4.3 Bare Escentuals Reports. Within thirty (30) days after the last day of each calendar quarter during the term of the license granted in Section 2.1, Bare Escentuals will provide BioKool with a written report setting forth a calculation of the royalties accrued from the sale of Royalty-Bearing Licensed Products during such quarter. Each royalty report shall be deemed the Confidential Information of Bare Escentuals.

4.4 Taxes. BioKool will be responsible for and will indemnify and hold Bare Escentuals harmless from payment of any taxes, fees, duties, and other governmental charges, and any related penalties and interest, in each case arising from the payment of any amounts owed to BioKool under this Agreement.

4.5 Audit by BioKool. For a period of two (2) years from the date of sale of given Royalty-Bearing Licensed Products (“Audit Period”), Bare Escentuals shall keep accurate records as necessary to determine the royalty payable to BioKool under this Section 4 for such products (“Records”). During the Audit Period, upon at least thirty (30) days prior written notice, Bare Escentuals shall permit BioKool, or its designated representative who is bound by confidentiality obligations no less protective of Bare Escentuals than those set forth in this Agreement, to inspect and review the Records, at BioKool’s expense, during Bare Escentuals’ normal business hours. All such inspection and review shall occur at Bare Escentuals’ offices and shall not unreasonably interfere with Bare Escentuals’ regular business operations. BioKool shall only have the right to inspect and review Records dating back two (2) years from the end of the year for which review is requested. If such inspection reveals that Bare Escentuals’ payments were less than the amount which should have been paid, then Bare Escentuals shall pay to BioKool any sums shown to be due. If the underpayment was in excess of ten percent (10%) of the total sums accrued and due during the period for which such inspection and audit was made, Bare Escentuals shall also pay to BioKool the reasonable costs of such audit and inspection upon receipt of an appropriate invoice justifying the costs.

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5. CONFIDENTIALITY

5.1 Definition of Confidential Information. For purposes of this Agreement, “Confidential Information” means, subject to Section 5.2, all non-public or proprietary information disclosed by one party (the “Disclosing Party”) to the other party (the “Receiving Party”) in the course of activity pursuant to this Agreement, including such information disclosed in contemplation of this Agreement prior to the Effective Date, whether disclosed in oral, written, graphic, machine recognizable model or sample form, or any derivation thereof, except as otherwise provided in Section 5.4. Confidential Information may include data, know-how, algorithms, computer programs, data bases, processes, improvements, desi