Exhibit 10.1
AMENDMENT NO. 1
TO EMPLOYMENT AGREEMENT OF
XXXX XXXXX
Reference is made to that certain employment agreement dated as of
October 1, 2002 between Vital Living, Inc., a Nevada corporation (the "Company")
and Xxxxxxx X. Xxxxx (the "Executive").
The parties hereto desire, in connection with the closing of the
transaction to acquire all of the outstanding interest of MAF BioNutritionals,
LLC, ("MAF") to amend the employment agreement (the "Agreement") as follows:
1. The term of the Agreement shall be extended through November [ ]
2005. The Base Compensation in the additional year provided for
by this extension shall be $228,000.
Employee shall be entitled to participate in a profit sharing
plan to be enacted by the Board of Directors, which plan shall
provide for distributions to selected executive employees of an
aggregate of up to 6% of the net pre-tax profit of the Company,
determined as soon as practical after the end of each fiscal
year, plus such other bonuses as may be determined by the Board
of Directors of the Company from time to time.
2. Executive shall approve and sign all checks other than (i)
normal recurring expenditures incurred in the ordinary course of
business or (ii) any check over $25,000, which checks shall
require the signature of at least two of the following employees
(Xxxx Xxxxx, Xxxxxx Xxxxxx or Xxxx Xxxxxx).
3. Section 3.3 shall be of no further force and effect and shall be
replaced in its entirety by the following:
Executive shall have the right during each year of the term, in
addition to 5 sick days and days in which Company is closed, to
take an aggregate of four weeks of paid vacation time at such
time as may be mutually agreed by the Company and Employee.
Unused vacation or sick days shall not accumulate.
4. Company will reimburse Employee for actual and necessary travel
and accommodation costs, entertainment and other business
expenses incurred as a necessary part of discharging the
Employee's duties hereunder, subject to receipt of reasonable
and appropriate documentation by Company. If Employee is
required to undertake any travel on behalf of the Company,
Employee may be furnished business class air travel, and shall
stay in first class accommodations (i.e., Hyatt's Marriott or
Hilton Hotels). If available, Company may purchase upgrade
certificates for use by Employee with respect to his air travel.
5. To the extent that the Company does not initially have customary
health benefits, the Company will reimburse Employee for any
health insurance premium costs. Notwithstanding the foregoing,
the Company will obtain term life insurance in the principal
amount of $1,000,000, and Employee shall be entitled to
designate any beneficiary with respect to such policy. The
employee will also allow the Company to have in place a key man
insurance policy designating the Company as the insured in the
amount of $1,000,000
6. Sections 5, 6 and 7 of the Agreement shall be of no further
force or effect and shall be replaced in its entirety by the
following:
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(a) Termination Upon Death or Disability.
If during the Term, Employee should (i) die or (ii) become so
physically or mentally disabled whether totally or partially, that Employee is
unable to perform the duties, functions and responsibilities required hereunder
for (aa) a period of three (3) consecutive months or (bb) shorter periods
aggregating to four (4) months within any period of twelve (12) months
("Disability"), then in such event, Company may, at any time thereafter, by 30
days written notice to Employee, terminate Employee's services hereunder.
Employee agrees to cause Employee to submit to reasonable medical examinations
upon the reasonable request of Company (and Employee shall be entitled to have
his physician present. The existence of Employee's disability for the purposes
of this Agreement shall be determined by a reputable physician selected by
Company who is experienced in the relevant field of medicine. If Employee's
services are terminated, as aforesaid, Employee shall be entitled to receive
Employee's Base Compensation, accrued share of the Bonus for that Fiscal Year
and unused vacation (hereinafter collectively referred to as "Fringe Benefits"),
if any, earned through the date of Employee's termination and continuing
thereafter for an additional period of six (6) months.
(b) By Resignation or By Company for Cause.
If Employee's employment with the Company terminates due to his
voluntary resignation or if the Company terminates Employee's employment due to
Cause (as defined below), Company shall pay Employee all accrued Base
Compensation (with no Bonus for the year in which the termination of employment
took place), but no other compensation or reimbursement of any kind (except
other accrued or vested sums such as awarded bonuses and profit participations),
and thereafter Company's obligations hereunder shall terminate. Cause" shall
have the same meaning as set forth in the original Employment Agreement dated
October 1, 2002.
(c) Termination Without Cause.
If Employee's employment is terminated without "Cause", the
Company shall pay the Employee, within 30 days of such termination, the
remaining balance of the Base Compensation.
5. CHANGE OF CONTROL:
(a) Change of Control Event
In the event there has been a "Change of Control" (as defined
below) of the Company, Employee shall have the right, but not the obligation, to
consider such event to be a termination of this Agreement, in which event
Employee shall be entitled to rely on the rights afforded to him under Section
4(c) of the Amendment.
(b) Definition.
For purposes of this Agreement, "Change of Control" shall mean:
(i) any sale of all or substantially all of the assets
of the Company, or
(ii) any stock sale, merger or other business
combination in which the current shareholders no longer own in excess of 50% of
the outstanding stock of such surviving entity.
This Amendment is executed this 20th day of November, 2002.
Vital Living, Inc.
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By:
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Its:
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Agreed to and Accepted:
By:
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Xxxxxxx X. Xxxxx
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