FOUNDER COMPENSATION AGREEMENT
THIS FOUNDER COMPENSATION AGREEMENT ("Agreement") is made this ___ day
of , 2001 by and between LEXXUS INTERNATIONAL INC., a Delaware corporation
("Lexxus"), NATURAL HEALTH TRENDS CORP., a Florida corporation ("NHTC"), Xxxxxx
Xxxxxxxx and Xxx Xxxxxxxx (sometimes collectively referred to herein as
"Xxxxxxxx"), Xxxxxxx Xxxx ("Xxxx") and Xxxx Xxxxxxx ("Xxxxxxx").
BACKGROUND
X. Xxxxxxxx, Xxxx and Xxxxxxx have provided services to Lexxus in connection
with the formation, organization and financing of Lexxus.
B. In consideration of the above services, Lexxus has agreed to provide
compensation to Xxxxxxxx, Xxxx and Xxxxxxx in accordance with the terms of this
Agreement.
C. In addition, NHTC, as the majority shareholder of Lexxus, has agreed to
secure the payment by Lexxus of certain of its obligations hereunder and, as
additional compensation for services that directly benefitted NHTC, to issue
common stock of NHTC to Xxxxxxxx, Xxxx and Xxxxxxx upon the occurrence of
certain milestones as set forth herein.
AGREEMENT
NOW, THEREFORE, in order to properly document the consideration
promised for services previously performed by Xxxxxxxx, Xxxx and Xxxxxxx on
behalf of Lexxus and NHTC and for Xxxxxxxx, Xxxx and Xxxxxxx'x willingness to
enter into a Settlement Agreement with NHTC and the other parties thereto, the
parties hereto agree as follows:
1. Cash Compensation.
(a) Beginning on the date hereof, Lexxus shall pay:
(i) to Xxxxxxx, $1,000 per week for the remainder of
Xxxxxxx'x life,
(ii) to Xxxxxx Xxxxxxxx, $2,000 per week for the remainder
of Xxxxxx Xxxxxxxx'x life, and
(iii) to Xxxx, $2,000.00 per week for the remainder of Xxxx'x
life.
(b) The amounts payable by Lexxus pursuant to paragraph 1(a)
above, shall be paid by Friday of each week on or before 5:00 p.m. E.S.T.
(c) In the event of the death of Xxxxxx Xxxxxxxx, Xxxx or
Xxxxxxx, Lexxus shall pay to such person's estate any monies owed hereunder as
of the date of death.
2. Non-Cash Compensation. In addition to the cash compensation described in
paragraph 1 above, Lexxus agrees to notify Xxxxxxxx at least fourteen (14) days
prior to any Lexxus corporate event and, if Xxxxxxxx notifies Lexxus of a desire
to attend any such event, Lexxus shall pay for all expenses (excluding airfare)
incurred by Xxxxxxxx in connection with Xxxxxxxx'x attendance at such event,
including rental car, lodging and meal expenses.
3. Issuance of Stock.
(a) NHTC agrees to issue 333,334 shares of its common stock to Xxxxxxxx
(as tenants by the entirety), and 333,333 shares of its common stock to each of
Xxxx and Xxxxxxx for every $1,000,000 in gross revenues received by Lexxus, up
to a maximum of 10,000,000 shares of stock in the aggregate being issued to
Xxxxxxxx, Xxxx and Xxxxxxx hereunder. The parties acknowledge that, as of the
date hereof, $1,600,000.00 shall be deemed to have been received by Lexxus as
gross revenues, which shall include all revenues generated by Product Brokers
Com, Inc. from the distribution of Viacream. On a monthly basis, Lexxus shall
determine its gross revenues and shall provide NHTC, Xxxxxxxx, Xxxx and Xxxxxxx
with a report listing (i) the gross revenues for the preceding month, and (ii)
the aggregate gross revenues (including all amounts received by Lexxus since
NHTC last issued shares to Xxxxxxxx, Xxxx and Xxxxxxx hereunder) received by
Lexxus. Within fourteen (14) days after receipt of a report, NHTC shall issue to
Xxxxxxxx, Xxxx and Xxxxxxx the shares of NHTC common stock, if any, required to
be issued hereunder.
(b) Upon execution of this Agreement, NHTC will issue 333,334 shares of
its common stock to Xxxxxxxx (as tenants by the entirety) and 333,333 shares of
its common stock to each of Xxxx and Xxxxxxx, as a result of aggregate gross
revenues having exceeded $1,000,000 as of the date hereof.
4. Stock Pledge Agreement. Simultaneously herewith, NHTC agrees to enter into a
Stock Pledge Agreement in favor of Xxxxxxxx, Xxxx and Xxxxxxx, pursuant to which
NHTC shall pledge its shares of common stock in Lexxus in order to secure the
payment by Lexxus of amounts due pursuant to paragraph 1 above to Sullivan,
Bray, and Xxxxxxx. In the event of a default in payment by Lexxus hereunder,
which default is the result of a court or administrative order, including but
not limited to a cease and desist order from a state or federal attorney general
or an injunction (an "Order") prohibiting Lexxus from expending any funds,
Xxxxxxxx, Xxxx and Xxxxxxx agree that they will not exercise their rights under
the Stock Pledge Agreement during the pendency of such Order.
5. Pledge and Security Agreements. Simultaneously herewith, Lexxus agrees to
enter into Pledge and Security Agreements in favor of Xxxxxxxx, Xxxx and
Xxxxxxx, pursuant to which Lexxus shall pledge all of its assets in order to
secure the payment by Lexxus of amounts due pursuant to paragraph 1 above to
Sullivan, Bray, and Xxxxxxx. In the event of a default in payment by Lexxus
hereunder, which default is the result of a court or administrative order,
including but not limited to a cease and desist order from a state or federal
attorney general or an injunction (an "Order") prohibiting Lexxus from expending
any funds, Xxxxxxxx, Xxxx and Xxxxxxx agree that they will not exercise their
rights under the Pledge and Security Agreements during the pendency of such
Order.
6. Additional Agreements. Lexxus agrees that it will not terminate the
distributor positions held by Xxxxxxxx, Xxxx and Xxxxxxx (ID Nos. 1016 and 1017)
in Lexxus, unless such termination is in accordance with Lexxus' policies and
procedures as applicable to all distributors.
7. No Further Obligation. Lexxus acknowledges and agrees that any and all
services performed by Xxxxxxxx, Xxxx and Xxxxxxx as a condition to the
compensation described herein have been completed to the satisfaction of Lexxus.
None of Xxxxxxxx, Xxxx or Xxxxxxx shall be required to perform any additional
services of any type for or on behalf of Lexxus, unless in accordance with a
separate written agreement for such services.
8. Binding Effect. This Agreement shall be binding upon the parties and their
successors, assigns or heirs, as the case may be.
9. Applicable Law, Jurisdiction and Venue. This Agreement shall be governed by
and construed in accordance with the laws of the State of Texas. Exclusive
jurisdiction and venue for any dispute arising out of this Agreement shall be in
the state court in and for Dallas, Texas or the federal court in and for Dallas,
Texas, as applicable.
10. Modifications. No modification of this Agreement shall be binding unless it
is in writing and signed by an authorized representative of the party against
whom enforcement of the modification is sought.
11. Attorneys Fees. In the event any litigation or arbitration between the
parties arises out of or results in connection with this Agreement, the
prevailing party in such proceeding shall be entitled to recover from the other
party its reasonable attorneys' fees and expenses, including appellate
proceedings or post-judgment collection proceedings.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on the day and year first above written.
LEXXUS INTERNATIONAL INC. NATURAL HEALTH TRENDS CORP.
By:__________________________ By:___________________________
Name: _______________________ Name: ________________________
Title: ______________________ Title: _______________________
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Xxxxxxx Xxxx Xxxxxx Xxxxxxxx
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Xxxx Xxxxxxx Xxx Xxxxxxxx
