EX-10.53
TERMINATION AGREEMENT
BY AND BETWEEN
NU SKIN INTERNATIONAL, INC.
AND
NU SKIN USA, INC.
March 8, 1999
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TERMINATION AGREEMENT
This Termination
Agreement (the "Agreement") is entered into effective
as of March
8, 1999 by and between Nu Skin International, Inc., a Utah
corporation ("Nu
Skin International"), and Nu Skin USA, Inc., a Delaware
corporation ("Nu Skin USA"). Nu Skin International and Nu Skin USA are
referred
to herein, collectively, as the "Parties" and, individually, as a
"Party."
RECITALS
A. WHEREAS,
Nu Skin International previously entered into certain
licenses and
agreements
with Nu Skin USA
(which agreements
are referred to
herein, collectively,
as the Terminated
Agreements (as that term is defined in
Section 1.5 below)),
which Terminated Agreements are each identified in Section
1 below;
B. WHEREAS, the respective parties to each of the Terminated
Agreements
now desire to terminate each of the Terminated Agreements, as set forth herein
and in exchange for the Termination Fee (as that term is
defined in Section 2.1
below); and
C. WHEREAS, in
connection with this
Agreement and the
termination of
the Terminated
Agreements as set forth in and contemplated by this Agreement,
simultaneously with
the execution of this Agreement Nu Skin International will
pay the Termination
Fee to Nu Skin USA in
exchange for the
termination of the
Terminated Agreements, as set forth in and contemplated by this
Agreement.
NOW, THEREFORE,
in consideration of the foregoing premises and the
mutual promises and agreements set forth herein, and for other good
and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the
Parties agree as follows:
1. Terminated
Agreements. The
following licenses and
agreements have
previously been entered into by and between the respective
Parties thereto,
as
indicated below:
1.1 Sublease
Agreement. A Sublease
Agreement dated effective as of
January 1, 1998
entered into by and between Nu Skin International and Nu Skin
USA (the "Sublease
Agreement"),
a copy of which is
attached as Exhibit "A"
hereto.
1.2 Licensing and
Sales Agreement.
A Licensing
and Sales Agreement
dated effective
as of December
31, 1997 entered into by and between Nu Skin
International and Nu Skin USA (the "Licensing and Sales
Agreement"),
a copy of
which is attached as Exhibit "B" hereto.
1.3
Trademark/Tradename
Agreement. A
Trademark/Tradename
Licensing
Agreement dated effective as of December 31, 1997 entered into by
and between Nu
Skin International and Nu Skin USA (the "Trademark/Tradename
Agreement"), a copy
of which is attached as Exhibit "C" hereto.
1.4 Distribution
Agreement. A Wholesale
Distribution Agreement
dated
effective as of
December 31, 1997 entered into by and between Nu Skin
International and Nu Skin USA (the "Distribution Agreement"), a
copy of which is
attached as Exhibit "D" hereto.
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1.5 The Terminated Agreements; Termination. The Sublease Agreement,
the
Licensing and
Sales Agreement, the Trademark/Tradename Agreement, and the
Distribution Agreement are, collectively, referred to herein as the
"Terminated
Agreements" and,
individually,
as a "Terminated
Agreement."
The respective
parties to each
of the Terminated Agreements hereby terminate each of the
Terminated Agreements
to which they are a
party effective as of
the effective
date of this Agreement (as first above written), and in so doing agree to cause
each of the respective
parties to each of the
Terminated Agreements
to become
subject to any
and all rights and obligations provided under each of the
respective Terminated
Agreements
upon the termination thereof, if any. The
rights and obligations
of each of the parties under each Terminated Agreement
following the
termination
thereof shall be governed by the terms of the
respective Terminated
Agreement as if such Terminated Agreement had been
terminated in accordance with its terms. This Agreement shall in no way limit
any rights or
obligations, if any,
that any Terminated
Agreement provides
or
contemplates shall
continue following the termination of such Terminated
Agreement, except as otherwise expressly set forth herein.
1.5.1 Reaffirmation of
Existing Agreements.
Notwithstanding
the provisions of Section 1.5 above, the Parties hereby acknowledge
and
reaffirm (a) the
Tax Sharing and Indemnification Agreement dated
December 31, 1997 entered into by and among Nu Skin International, Nu
Skin USA, and their
respective
shareholders, (b) the
Assumption
of
Liabilities and
Indemnification
Agreement
dated effective as of
December 31, 1997 entered into by and between Nu Skin International
and
252nd Shelf Corporation, a Delaware corporation (now known
as "Nu Skin
USA, Inc."), and (c) the Employee Benefits Allocation Agreement
(undated) entered into by and between Nu Skin International and Nu
Skin
USA (collectively, the
"Existing Agreements"). The Existing Agreements
shall remain in full
force and effect as
originally executed
and are
not being terminated,
modified, or amended in any manner or respect by
this Agreement or any of the transactions contemplated hereby.
2.
Termination Fee; Payment of Termination Fee.
2.1 Termination Fee;
Payment of Termination Fee. Upon the execution of
this Agreement by each
of the Parties, and in
exchange for the
termination of
the Terminated Agreements as set forth in and contemplated by this
Agreement, Nu
Skin International
will pay to Nu Skin
USA Ten Million
Dollars
($10,000,000)
(the "Termination
Fee"). The Termination Fee shall be paid by Nu Skin
International on the date this Agreement becomes effective (the "Closing
Date")
in cash by wire transfer or delivery of other immediately available
funds.
2.1.1 Tax Consequences. The Parties agree that the Termination
Fee is income to Nu Skin USA and is amortizable by Nu Skin
International. The Parties also agree not to take any position
contrary
to or inconsistent
with the treatment of
the Termination
Fee as set
forth in the immediately preceding sentence.
3. Representations
and Warranties of Nu Skin USA. Nu Skin
USA represents and
warrants to Nu Skin International that the statements contained in this Section
3 are correct and complete as of the Closing Date.
3.1 Organization. Nu
Skin USA is a corporation duly organized, validly
existing, and in
good standing under the laws of the jurisdiction of its
incorporation.
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3.2 Authorization
of Transaction. Nu Skin USA has full power and
authority (including
full corporate power and authority) to execute and deliver
this Agreement and to perform its obligations hereunder. Without limiting the
generality of the
foregoing,
the Board of Directors
of Nu Skin USA,
and, if
required, Nu Skin
USA's stockholders, have duly authorized the execution,
delivery, and
performance
of this Agreement by Nu Skin USA.
This Agreement
constitutes the valid and legally binding obligation of Nu Skin
USA, enforceable
in accordance with its terms and conditions.
3.3 Non-contravention.
Neither the execution
and the delivery of
