EXHIBIT 10.37
EMPLOYMENT AGREEMENT
This Employment Agreement (the "AGREEMENT"), dated as of March 10, 2003
(the "EFFECTIVE DATE"), is made and entered by and between Xxxxx Xxxxxx (the
"EXECUTIVE") and HERBALIFE INTERNATIONAL, INC., a Nevada corporation ("PARENT"),
and HERBALIFE INTERNATIONAL OF AMERICA, INC., a California corporation
("OPERATING COMPANY") (collectively, Parent and Operating Company are referred
to herein as the "COMPANY"). This Agreement amends, restates and replaces in its
entirety that certain Employment Agreement among the parties hereto dated as of
August 20, 2000, as the same may have been amended or modified.
RECITALS
A. The Company is engaged primarily in the distribution of weight
management, nutritional and personal care products through a
"multi-level" marketing system.
B. The Company desires to be assured of the services of Executive
by employing Executive in the capacity and on the terms set
forth below.
C. Executive desires to commit himself or herself to serve the
Company on the terms herein provided.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and of the respective
covenants and agreements set forth below, the parties hereto agree as follows:
1. Employment Period. The Company shall continue to employ Executive and
Executive shall continue in the employ of the Company for the period
commencing on the Effective Date and ending on the date that is three
(3) years thereafter, unless sooner terminated in accordance with the
provisions of this Agreement (the "TERM"). After the Term, the parties
may (but shall be under no obligation to), by written agreement, renew
or extend the term of the Agreement for an additional period or
periods. The term of each renewal period of this Agreement is referred
to herein as a "RENEWAL PERIOD"; and references to the "TERM" shall
mean the period beginning on the Effective Date and ending on the date
of termination of Executive's services for the Company, whether at the
end of the Term or a Renewal Term or otherwise in accordance with the
provisions of this Agreement. Upon expiration of the Term, except as
expressly set forth herein (including in Section 5 and Section 6), this
Agreement and all of its provisions shall terminate and shall cease to
have any force or effect.
2. Duties.
(a) During the Term, Executive shall serve as a Co-President of
the Company, with such authority and duties as are assigned to
Executive from time to time by the
Board of Directors of Parent (the "BOARD") or the Chief
Executive Officer of Parent ("CEO") that are substantially
similar to the authority and duties currently vested in
Executive by the Board. Each of the undersigned acknowledges
and agrees that the Company may, subsequent to the Effective
Date, hire a CEO, and that any such CEO hiring may result in a
readjustment of Executive's title, authority, duties and
responsibilities for the Company; provided that in no event
shall Executive's title, authority, duties and
responsibilities for the Company be reduced, in the aggregate,
below the level of such title, authority, duties and
responsibilities vested in Executive in his or her capacity as
the Executive Vice President of Sales of the Company prior to
his or her promotion to Co-President. Executive will work
principally in the Los Angeles, California offices of the
Company, but will also conduct such business travel as is
reasonably required to fulfill his or her duties hereunder.
During the Term, Executive shall report to the Board and/or
the CEO.
(b) During the Term, Executive shall devote substantially all his
or her working time, attention, skill and efforts to the
business and affairs of the Company, will use his or her best
efforts to promote the success of the Company's business, and
shall not enter the employ of or serve as a consultant to, any
other company; provided, however, the foregoing shall not
preclude Executive from devoting a reasonable amount of time
to managing Executive's investments and personal affairs and
to charitable and civic activities.
3. Compensation and Related Matters.
(a) Salary. During the Term, Executive shall receive a salary at
the per annum rate of Seven Hundred Twelve Thousand Five
Hundred Dollars ($712,500), payable semi-monthly or otherwise
in accordance with the Company's payroll practices for senior
executives. Executive's annual base salary shall be subject to
review from time to time for possible increases by the Board.
Executive's base salary, as increased from time to time, shall
be referred to as the "BASE SALARY."
(b) Expenses. The Company shall reimburse Executive for all
reasonable travel and other reasonable out-of-pocket business
expenses incurred by Executive in the performance of his or
her duties under this Agreement upon evidence of payment and
otherwise in accordance with the Company's policies and
procedures in effect from time to time.
(c) Employee Benefits. During the Term, Executive shall be
entitled to participate in or receive benefits under each
benefit plan or arrangement made available by the Company to
its senior executives (including, without limitation, those
relating to group medical, dental, vision, long-term
disability and life insurance) on terms no
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less favorable than those generally applicable to senior
executives of the Company, subject to and on a basis
consistent with the terms, conditions and overall
administration of such plans and subject to the Company's
right to modify, amend or terminate any such plan or
arrangement. Executive's individual participation levels in
the Company's and its affiliates' equity compensation
arrangements (including stock option plans) will be determined
by the Board in its sole discretion. In the event the Company
or its affiliates decide to grant Executive any stock options
or other equity compensation, any such stock options or equity
compensation will be made pursuant to separate written
agreements between Executive and the Company or its
affiliates.
(d) Bonus. Notwithstanding any provision in this Agreement to the
contrary, Executive agrees that he or she shall cease to be a
participant of and shall not be entitled to any additional
compensation or payments under the 1994 Performance-Based
Annual Incentive Compensation Plan (the "1994 PLAN") for any
period after June 30, 2002 and that the termination of
participation in the 1994 Plan will not cause any additional
benefit to be payable to Executive as a result of such
termination. Executive and the Board have separately
established Executive's bonus opportunity and bonus objectives
for the calendar year ended December 31, 2003. For all
calendar years during the Term following the calendar year
ended December 31, 2003, Executive's bonus opportunity will be
not less than the amount of Executive's bonus opportunity for
the calendar year ended December 31, 2003, it being agreed
that Executive's individual bonus objectives will be
established on an annual basis by the Board in its good faith
discretion.
(e) Vacation. Executive shall be entitled to five (5) weeks paid
vacation during each year of the Term. Unused vacation in any
year shall carry over to subsequent years without limitation,
unless otherwise provided in a vacation pay policy that is
generally applicable to the senior executives of the Company.
(f) Deductions and Withholdings. All amounts payable or which
become payable hereunder shall be subject to all deductions
and withholding required by law.
4. Termination. Executive's services for the Company and the Term of this
Agreement may be terminated under the following circumstances:
(a) Death. Executive's services hereunder shall terminate upon his
or her death. In the case of Executive's death, the Company
shall pay (in accordance with Section 4(f) hereof) to
Executive's beneficiaries or estate, as appropriate, (i) his
or her then current accrued and unpaid Base Salary through his
or her date of death as well as 100% of any accrued and unpaid
bonus for any years preceding the year of termination (it
being expressly agreed that except as hereinafter provided,
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Executive shall have no rights to receive a bonus in respect
of the year in which termination occurs), (ii) an additional
amount equal to one year of Base Salary and Executive's bonus
for the year of termination (it being agreed that Executive's
bonus for the year of termination to be paid under this
Section 4(a) shall be deemed to be equal to one year of Base
Salary), and (iii) other benefits and payments (including,
without limitation, reimbursement of expenses incurred
conducting Company business pursuant to Section 3(b)) to which
Executive is then entitled hereunder. Executive, his
beneficiaries or his estate, as appropriate, shall be entitled
to no other compensation under this Agreement following, or as
a result of, a termination under these circumstances.
(b) Disability.
(i) If a Disability (as defined below) of Executive
occurs during the Term, the Board may give Executive
written notice of its intention to terminate his or
her employment. In such event, Executive's services
with the Company shall terminate as of the date of
such notice. In the case of a termination as a result
of a Disability, the Company shall pay (in accordance
with Section 4(f) hereof) to Executive (i) his or her
then current accrued and unpaid Base Salary through
the effective date of his or her termination as well
as 100% of any accrued and unpaid bonus for any years
preceding the year of termination (it being expressly
agreed that except as hereinafter provided, Executive
shall have no rights to receive a bonus in respect of
the year in which termination occurs), (ii) an
additional amount equal to one year of Base Salary
and Executive's bonus for the year of termination (it
being agreed that Executive's bonus for the year of
termination to be paid under this Section 4(b) shall
be deemed to be equal to one year of Base Salary),
and (iii) other benefits and payments (including,
without limitation, reimbursement of expenses
incurred conducting Company business pursuant to
Section 3(b)) to which Executive is then entitled
hereunder. Executive and his or her beneficiaries, as
appropriate, shall be entitled to no other
compensation under this Agreement following, or as a
result of, a termination under these circumstances.
(ii) For the purpose of this Section 4(b), "DISABILITY"
shall mean Executive's inability to perform his or
her duties for the Company on a full-time basis for
120 consecutive days or a total of 180 days in any
twelve (12) month period as reasonably determined by
the Board.
(c) Termination by the Company for Cause. The Board may terminate
Executive's services hereunder for Cause (as defined below) at
any time upon written notice to Executive. In such event,
Executive's services shall terminate as of the date of
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such notice. In the case of Executive's termination for Cause,
the Company shall pay (in accordance with Section 4(f) hereof)
to Executive (i) his or her then current accrued and unpaid
Base Salary through the effective date of his or her
termination as well as 100% of any accrued and unpaid bonus
for any years preceding the year of termination (it being
expressly agreed that Executive shall have no rights to
receive a bonus in respect of the year in which termination
occurs) and (ii) other benefits and payments (including,
without limitation, reimbursement of expenses incurred
conducting Company business pursuant to Section 3(b)) to which
Executive is then entitled hereunder. Executive and his or her
beneficiaries, as appropriate, shall be entitled to no other
compensation under this Agreement following, or as a result
of, a termination under these circumstances. For purposes of
this Agreement, the Board shall have "CAUSE" to terminate
Executive's services hereunder in the event of any of the
following acts or circumstances: (i) Executive's commission of
a felony or any other act or omission involving dishonesty,
disloyalty or fraud with respect to the Company or any of its
affiliates or any of their distributors, suppliers or other
material business relations; (ii) conduct by Executive which
could reasonably be expected to bring the Company or any of
its affiliates into substantial public disgrace or disrepute;
(iii) Executive's substantial and repeated failure to perform
Executive's lawful duties as contemplated in Section 2 of this
Agreement; (iv) Executive's gross negligence or willful
misconduct with respect to any material aspect of the business
of the Company or any of its affiliates; (v) Executive's
failure to comply in any material respect (including, without
limitation, the making of any certifications required
thereunder) with applicable laws, including, without
limitation, the Securities Act of 1933, as amended, the
Securities Exchange Act of 1934, as amended, the
Xxxxxxxx-Xxxxx Act of 2002, as amended, or any of the rules
and regulations promulgated under any of the foregoing laws;
or (vi) any material breach of this Agreement or any material
breach of any other written agreement between Executive and
the Company's affiliates governing Executive's equity
compensation arrangements (i.e., any agreement with respect to
Executive's stock and/or stock options of any of the Company's
affiliates).
(d) Termination by Executive. Executive may terminate his or her
employment hereunder for any reason or no reason, provided
that Executive first gives the Company a written notice of
termination at least fifteen (15) calendar days prior to the
effective date of any such termination. In the event Executive
terminates his or her employment, the Company shall pay (in
accordance with Section 4(f) hereof) to Executive (i) his or
her current accrued and unpaid Base Salary through the
effective date of his or her termination as well as 100% of
any accrued and unpaid bonus for any year preceding the year
of termination (it being expressly agreed that Executive shall
have no rights to receive a bonus in respect of the year in
which termination occurs) and (ii) other benefits and payments
(including,
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without limitation, reimbursement of expenses incurred
conducting Company business pursuant to Section 3(b)) to which
Executive is then entitled hereunder. Executive and his or her
beneficiaries, as applicable, shall be entitled to no other
compensation under this Agreement following, or as a result
of, a termination under these circumstances.
(e) Termination by the Company Without Cause. The Board may
terminate Executive's services hereunder without Cause at any
time upon written notice to Executive. In such event,
Executive's services shall terminate as of the date of such
notice. In the event Executive's services hereunder are
terminated by the Company without Cause, and subject to
Executive's compliance with the terms of Section 5 and Section
6 herein, the Company shall pay (in accordance with Section
4(f) hereof) to Executive (i) his or her then current accrued
and unpaid Base Salary through the effective date of his
termination as well as 100% of any accrued and unpaid bonus
for any years preceding the year of termination (it being
expressly agreed that except as hereinafter provided,
Executive shall have no rights to receive a bonus in respect
of the year in which termination occurs), (ii) an additional
amount equal to one year of Base Salary and Executive's bonus
for the year of termination (it being agreed that Executive's
bonus for the year of termination to be paid under this
Section 4(e) shall be deemed to be equal to one year of Base
Salary), and (iii) other benefits and payments (including,
without limitation, reimbursement of expenses incurred
conducting Company business pursuant to Section 3(b)) to which
Executive is then entitled hereunder. In addition, during the
one (1) year period immediately following the date of
termination, the Company shall continue to afford to Executive
the group medical, dental, vision, long-term disability and
life insurance specified in Section 3(c) above. Executive and
his or her beneficiaries, as applicable, shall be entitled to
no other compensation under this Agreement following, or as a
result of, a termination under these circumstances. Executive
shall have no duty to seek to mitigate the above severance
benefits in the event of termination hereunder without Cause,
and, subject to Executive's compliance with Section 5 and
Section 6 herein, any compensation derived by Executive from
alternative employment or otherwise shall not reduce the
Company's obligations hereunder.
(f) Payments to Executive. Subject to Executive's continuing
compliance with the provisions of Section 5 and Section 6
herein, any amounts payable to Executive upon his or her
termination of employment under this Section 4 shall be paid
at such times as such amounts would have otherwise been
payable to Executive had Executive's employment not been
terminated.
(g) Resignation of Offices. Promptly following any termination of
Executive's employment with the Company (other than by reason
of Executive's death),
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Executive shall promptly deliver to the Company reasonably
satisfactory written evidence of Executive's resignation as a
member of the board of directors and/or any office (e.g.,
office of Co-President) with the Company or any of its
affiliates. The Company shall be entitled to withhold payment
of any amounts otherwise due pursuant to this Section 4 until
Executive has complied with the provisions of this Section
4(g).
(h) Release. As a precondition to the Company's obligations to
make any of the payments specified in Sections 4(a), 4(b) or
4(e) of this Agreement, Executive or his or her guardian,
estate or heirs, as appropriate, shall execute and deliver to
the Company an enforceable and fully effective (i.e., there
shall be no further unsatisfied conditions to the
effectiveness thereof) general release in form and substance
reasonably satisfactory to the Company.
(i) Employee Benefit Plan Rights. Following any termination of
Executive's employment with the Company, any rights that may
exist in Executive's favor to payment of any amount under any
employee benefit plan or arrangement of the Company other than
those set forth in this Agreement shall be made in accordance
with the terms and conditions of any such employee benefit
plan or arrangement.
5. Confidential and Proprietary Information.
(a) The parties agree and acknowledge that during the course of
Executive's employment, Executive has been given and will have
access to and be exposed to trade secrets and confidential
information in written, oral, electronic and other forms
regarding the Company and its affiliates (which includes but
is not limited to all of its business units, divisions and
affiliates) and their business, equipment, products and
employees, including, without limitation: the identities of
the Company's and its affiliates' distributors and customers
and potential distributors and customers (hereinafter referred
to collectively as "DISTRIBUTORS"), including, without
limitation, the identity of Distributors that Executive
cultivates or maintains while providing services at the
Company or any of its affiliates using the Company's or any of
its affiliates' products, name and infrastructure, and the
identities of contact persons with respect to those
Distributors; the particular preferences, likes, dislikes and
needs of those Distributors and contact persons with respect
to product types, pricing, sales calls, timing, sales terms,
rental terms, lease terms, service plans, and other marketing
terms and techniques; the Company's and its affiliates'
business methods, practices, strategies, forecasts, pricing,
and marketing techniques; the identities of the Company's and
its affiliates' licensors, vendors and other suppliers and the
identities of the Company's and its affiliates' contact
persons at such licensors, vendors and other
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suppliers; the identities of the Company's and its affiliates'
key sales representatives and personnel and other employees;
advertising and sales materials; research, computer software
and related materials; and other facts and financial and other
business information concerning or relating to the Company or
any of its affiliates and their business, operations,
financial condition, results of operations and prospects.
Executive expressly agrees to use such trade secrets and
confidential information only for purposes of carrying out his
duties for the Company and its affiliates, and not for any
other purpose, including, without limitation, not in any way
or for any purpose detrimental to the Company or any of its
affiliates. Executive shall not at any time, either during the
course of his or her employment hereunder or after the
termination of such employment, use for himself or herself or
others, directly or indirectly, any such trade secrets or
confidential information, and, except as required by law,
Executive shall not disclose such trade secrets or
confidential information, directly or indirectly, to any other
person or entity. Trade secret and confidential information
hereunder shall not include any information which (i) is
already in or subsequently enters the public domain, other
than as a result of any direct or indirect disclosure by
Executive, (ii) becomes available to Executive on a
non-confidential basis from a source other than the Company or
any of its affiliates, provided that such source is not
subject to a confidentiality agreement or other obligation of
secrecy or confidentiality (whether pursuant to a contract,
legal or fiduciary obligation or duty or otherwise) to the
Company or any of its affiliates or any other person or entity
or (iii) is approved for release by the board of directors of
the Company or any of its affiliates or which the board of
directors of the Company or any of its affiliates makes
available to third parties without an obligation of
confidentiality.
(b) All physical property and all notes, memoranda, files,
records, writings, documents and other materials of any and
every nature, written or electronic, which Executive shall
prepare or receive in the course of his or her employment with
the Company and which relate to or are useful in any manner to
the business now or hereafter conducted by the Company or any
of its affiliates are and shall remain the sole and exclusive
property of the Company and its affiliates, as applicable.
Executive shall not remove from the Company's premises any
such physical property, the original or any reproduction of
any such materials nor the information contained therein
except for the purposes of carrying out his or her duties to
the Company or any of its affiliates and all such property
(except for any items of personal property not owned by the
Company or any of its affiliates), materials and information
in his or her possession or under his or her custody or
control upon the termination of his or her employment shall be
immediately turned over to the Company and its affiliates, as
applicable.
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(c) All inventions, improvements, trade secrets, reports, manuals,
computer programs, tapes and other ideas and materials
developed or invented by Executive during the period of his or
her employment, either solely or in collaboration with others,
which relate to the actual or anticipated business or research
of the Company or any of its affiliates which result from or
are suggested by any work Executive may do for the Company or
any of its affiliates or which result from use of the
Company's or any of its affiliates' premises or property
(collectively, the "DEVELOPMENTS") shall be the sole and
exclusive property the Company and its affiliates, as
applicable. Executive assigns and transfers to the Company his
or her entire right and interest in any such Development, and
Executive shall execute and deliver any and all documents and
shall do and perform any and all other acts and things
necessary or desirable in connection therewith that the
Company or any of its affiliates may reasonably request.
(d) The provisions of this Section 5 and Section 6 shall survive
any termination of this Agreement and termination of
Executive's employment with the Company.
6. Non-Solicitation.
(a) Executive acknowledges that in the course of his employment
for the Company he or she has become and will continue to
become familiar with the Company's and its affiliates' trade
secrets and other confidential information concerning the
Company and its affiliates. Accordingly, Executive agrees
that, during the Term and for a period of twelve (12) months
immediately thereafter (the "NONSOLICITATION PERIOD"), he or
she will not directly or indirectly through another entity (i)
induce or attempt to induce any employee or Distributor of the
Company or any of its affiliates to leave the employment of,
or cease to maintain its distributor relationship with, the
Company or such affiliate, or in any way interfere with the
relationship between the Company or any such affiliate and any
employee or Distributor thereof, (ii) hire any person who was
an employee of the Company or any of its affiliates at any
time during the Nonsolicitation Period or enter into a
distributor relationship with any person or entity who was a
Distributor of the Company or any of its affiliates at any
time during the Nonsolicitation Period, (iii) induce or
attempt to induce any Distributor, supplier, licensor,
licensee or other business relation of the Company or any of
its affiliates to cease doing business with the Company or
such affiliate, or in any way interfere with the relationship
between such Distributor, supplier, licensor, licensee or
business relation and the Company or any of its affiliates
(including, without limitation, making any negative statements
or communications about the Company or any of its affiliates)
or (iv) use any trade secrets or other confidential
information of the Company or any of its affiliates to
directly or indirectly participate in any means or manner in
any Competitive Business, wherever
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located. "COMPETITIVE BUSINESS" means the development,
marketing, distribution or sale of weight management products,
nutritional supplements or personal care products through
multi-level marketing or other direct selling channels.
"PARTICIPATE" includes any direct or indirect interest in any
enterprise, whether as an officer, director, employee,
partner, sole proprietor, agent, representative, independent
contractor, executive, franchisor, franchisee, creditor,
owner, distributor or otherwise; provided that the foregoing
activities shall not include the passive ownership (i.e.,
Executive does not directly or indirectly participate in the
business or management of the applicable entity) of less than
2% of the stock of a publicly-held corporation whose stock is
traded on a national securities exchange and which is not
primarily engaged in a Competitive Business.
(b) As long as Executive is employed by the Company, Executive
agrees that he or she will not, except with the express
written consent of the Board, become engaged in, render
services for, or permit his or her name to be used in
connection with any business other than the business of the
Company and its affiliates.
(c) Executive has agreed to be bound by the covenants contained in
this Section 6 for the purpose of preserving for the Company's
and its affiliates' benefit the goodwill, confidential and
proprietary information and going concern value of the Company
and its affiliates and their respective business
opportunities, and to protect the value of the capital stock
of the Company acquired by WH Holdings (Cayman Islands) Ltd.
pursuant to that certain Agreement and Plan of Merger dated
April 10, 2002, by and among WH Holdings (Cayman Islands)
Ltd., Herbalife International, Inc. and WH Acquisition Corp.
WH Holdings (Cayman Islands) Ltd. and each of its affiliates
are intended third party beneficiaries of the provisions of
Sections 5 and 6 of this Agreement.
7. Injunctive Relief. Executive and the Company (a) intend that the
provisions of Sections 5 and 6 be and become valid and enforceable, (b)
acknowledge and agree that the provisions of Sections 5 and 6 are
reasonable and necessary to protect the legitimate interests of the
business of the Company and its affiliates and (c) agree that any
violation of Section 5 or 6 will result in irreparable injury to the
Company and its affiliates, the exact amount of which will be difficult
to ascertain and the remedies at law for which will not be reasonable
or adequate compensation to the Company and its affiliates for such a
violation. Accordingly, Executive agrees that if Executive violates or
threatens to violate the provisions of Section 5 or 6, in addition to
any other remedy which may be available at law or in equity, the
Company shall be entitled to specific performance and injunctive
relief, without posting bond or other security, and without the
necessity of proving actual damages. In addition, in the event of a
violation or threatened violation by Executive of Section 5 or 6 of
this Agreement, the Nonsolicitation Period will be tolled
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until such violation or threatened violation has been duly cured. If,
at the time of enforcement of Sections 5 or 6 of this Agreement, a
court holds that the restrictions stated therein are unreasonable under
circumstances then existing, the parties hereto agree that the maximum
period, scope or geographical area reasonable under such circumstances
shall be substituted for the stated period, scope or area.
8. Assignment; Successors and Assigns. Executive agrees that he or she
shall not assign, sell, transfer, delegate or otherwise dispose of,
whether voluntarily or involuntarily, any rights or obligations under
this Agreement, nor shall Executive's rights hereunder be subject to
encumbrance of the claims of creditors. Any purported assignment,
transfer, delegation, disposition or encumbrance in violation of this
Section 8 shall be null and void and of no force or effect. Nothing in
this Agreement shall prevent the consolidation or merger of the Company
with or into any other entity, or the sale by the Company of all or any
portion of its properties or assets, or the assignment by the Company
of this Agreement and the performance of its obligations hereunder to
any successor in interest or any affiliated entity, and Executive
hereby consents to any and all such assignments. Subject to the
foregoing, this Agreement shall be binding upon and shall inure to the
benefit of the parties and their respective heirs, legal
representatives, successors, and permitted assigns, and, except as
expressly provided herein, no other person or entity shall have any
right, benefit or obligation under this Agreement as a third party
beneficiary or otherwise.
9. Governing Law; Jurisdiction and Venue. This Agreement shall be
governed, construed, interpreted and enforced in accordance with the
substantive laws of the State of California without regard to the
conflicts of law principles thereof. Suit to enforce this Agreement or
any provision or portion thereof may be brought in the federal or state
courts located in Los Angeles, California.
10. Severability of Provisions. In the event that any provision or any
portion thereof should ever be adjudicated by a court of competent
jurisdiction to exceed the time or other limitations permitted by
applicable law, as determined by such court in such action, then such
provisions shall be deemed reformed to the maximum time or other
limitations permitted by applicable law, the parties hereby
acknowledging their desire that in such event such action be taken. In
addition to the above, the provisions of this Agreement are severable,
and the invalidity or unenforceability of any provision or provisions
of this Agreement or portions thereof shall not affect the validity or
enforceability of any other provision, or portion of this Agreement,
which shall remain in full force and effect as if executed with the
unenforceable or invalid provision or portion thereof eliminated.
Notwithstanding the foregoing, the parties hereto affirmatively
represent, acknowledge and agree that it is their intention that this
Agreement and each of its provisions are enforceable in accordance with
their terms and expressly agree not to challenge the validity or
enforceability of this Agreement or any of its provisions, or portions
or aspects
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thereof, in the future. The parties hereto are expressly relying upon
this representation, acknowledgement and agreement in determining to
enter into this Agreement.
11. Warranty. As an inducement to the Company to enter into this Agreement,
Executive represents and warrants that he or she is not a party to any
other agreement or obligation for personal services, and that there
exists no impediment or restraint, contractual or otherwise, on his or
her power, right or ability to enter into this Agreement and to perform
his or her duties and obligations hereunder. As an inducement to
Executive to enter into this Agreement, Company represents and warrants
that the person signing this Agreement for the Company has been duly
authorized to do so by all necessary corporate action and has the
corporate power and authority to execute this Agreement on the
Company's behalf. The execution and delivery of this Agreement and the
consummation of the transactions contemplated have been duly and
effectively authorized by all necessary corporate action of the
Company.
12. Notices. All notices, requests, demands and other communications which
are required or may be given under this Agreement shall be in writing
and shall be deemed to have been duly given when received if personally
delivered; when transmitted if transmitted by telecopy, electronic or
digital transmission method upon receipt of telephonic or electronic
confirmation; the day after it is sent, if sent for next day delivery
to a domestic address by recognized overnight delivery service (e.g.,
Federal Express); and upon receipt, if sent by certified or registered
mail, return receipt requested. In each case notice will be sent to:
(a) If to the Company:
Herbalife International, Inc.
Herbalife International of America, Inc.
0000 Xxxxxxx Xxxx Xxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Board of Directors
Telecopy: (000) 000-0000
(b) with a copy to:
Herbalife International, Inc.
Herbalife International of America, Inc.
0000 Xxxxxxx Xxxx Xxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: General Counsel
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Telecopy: (000) 000-0000
(c) if to Executive, to:
c/o Herbalife International, Inc.
0000 Xxxxxxx Xxxx Xxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Telecopy: (000) 000-0000
(d) with a copy to:
Xxxx & Xxxxx Professional Corporation
0000 Xxxxxxx Xxxx Xxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx X. Short
Telecopy: (000) 000-0000
or to such other place and with other copies as either party may
designate as to itself, himself or herself by written notice to the others.
13. Cumulative Remedies. All rights and remedies of either party hereto are
cumulative of each other and of every other right or remedy such party
may otherwise have at law or in equity, and the exercise of one or more
rights or remedies shall not prejudice or impair the concurrent or
subsequent exercise of other rights or remedies.
14. Counterparts. This Agreement may be executed in several counterparts,
each of which will be deemed to be an original, but all of which
together shall constitute one and the same Agreement.
15. Entire Agreement. The terms of this Agreement are intended by the
parties to be the final expression of their agreement with respect to
the subject matter hereof and supersedes (and may not be contradicted
by, modified or supplemented by) any prior or contemporaneous
agreement, written or oral, with respect thereto. The parties further
intend that this Agreement shall constitute the complete and exclusive
statements of its terms and that no extrinsic evidence whatsoever may
be introduced in any judicial, administrative or other legal proceeding
to vary the terms of this Agreement. Executive further acknowledges
that this Agreement supersedes any prior agreement with respect to the
subject matter hereof (including without limitation, Executive's
employment agreement with the Company dated August 20, 2000, as the
same may have been amended). Further, Executive acknowledges that he or
she has been paid his benefit under the Herbalife International, Inc.
Senior Executive Change in Control Plan and that, upon such payment to
Executive, such plan was terminated in accordance with its terms.
13
16. Amendments; Waivers. This Agreement may not be modified, amended, or
terminated except by an instrument in writing, approved by the Board
and signed by Executive and a member of the Board other than Executive.
As an exception to the foregoing, the parties acknowledge and agree
that the Company shall have the right, in its sole discretion, to
reduce the scope of any covenant or obligation of Executive set forth
in Sections 5 or 6 of this Agreement or any portion thereof, effective
immediately upon receipt by Executive of written notice thereof from
the Company. No waiver of any of the provisions of this Agreement,
whether by conduct or otherwise, in any one or more instances, shall be
deemed to be construed as a further, continuing or subsequent waiver of
any such provision or as a waiver of any other provision of this
Agreement. No failure to exercise and no delay in exercising any right,
remedy or power hereunder shall preclude any other or further exercise
of any other right, remedy or power provided herein or by law or in
equity.
17. Representation of Counsel; Mutual Negotiation. Each party has had the
opportunity to be represented by counsel of its choice in negotiating
this Agreement. This Agreement shall therefore be deemed to have been
negotiated and prepared at the joint request, direction and
construction of the parties, at arm's-length, with the advice and
participation of counsel, and shall be interpreted in accordance with
its terms without favor to any party.
18. Indemnification. Executive shall be indemnified by the Company to the
maximum extent permissible from time to time under the Nevada General
Corporation Law, including with respect to advancement of expenses.
19. Suit to Enforce. In any action or proceeding to enforce any provision
of this Agreement, the prevailing party shall be entitled, in addition
to other remedies, to recover its, his or her attorney's fees and costs
of suit.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date and year first above written.
HERBALIFE INTERNATIONAL, INC.
By: /s/ Xxxxx Xxxx
-----------------------------------------
Name: Xxxxx Xxxx
---------------------------------------
Title: Co-President
--------------------------------------
HERBALIFE INTERNATIONAL OF AMERICA, INC.
By: /s/ Xxxxx Xxxx
-----------------------------------------
Name: Xxxxx Xxxx
---------------------------------------
Title: Co-President
--------------------------------------
EXECUTIVE
By: /s/ Xxxxx Xxxxxx
-----------------------------------------
Xxxxx Xxxxxx
