April 21, 2017 Mr. John Wilson Chief Executive Officer Fitlife Brands, Inc. Omaha, NE 68137 Re: Third Amendment to the Employment Agreement dated December 31, 2009 Dear John:
April 21, 2017
Mr. Xxxx Xxxxxx
Chief Executive Officer
0000 X. x 00xx Xxxxxx, Xxxxx 0
Xxxxx, XX 00000
Re: Third Amendment to the Employment Agreement dated December 31, 2009
Dear Xxxx:
This letter shall constitute an amendment (the “Amendment”) to the Employment Agreement, dated December 31, 2009, as amended, dated April 13, 2012 and June 30, 2014 (together, the “Agreement”) by and between FitLife Brands, Inc. (the “Company”) and you (“you” or the “Executive”), and shall modify the Agreement, as expressly set forth below. In the event of any conflict between the terms and provisions of this Amendment and the Agreement, the terms of this Amendment shall govern.
In connection with this Amendment, as additional consideration for the Amendment, the Company shall issue you 150,000 shares of the Company's common stock, which shares shall be restricted, under the terms of the Company’s 2010 Equity Incentive Plan (“Shares”), which Shares shall vest (i) 1/3rd upon the Company achieving annual reported cash flow from operations (“CFFO”) exceeding $3.0 million; (ii) 1/3rd upon CFFO exceeding $4.0 million; and (iii) 1/3rd upon CFFO exceeding $5.0 million. Upon the termination of Executive’s employment with the Company for any reason, any unvested Shares shall terminate and shall be of no further force and effect.
In consideration for the foregoing, and other good and valuable consideration, the Company and you agree to amend the Agreement as follows:
Section 3(a) and (b) of the Agreement shall be replaced in its entirety with the following, which shall be renumbered Section 3(a):
“Effective July 1, 2016 through the Termination Date, the Executive's salary shall be $310,000 per annum (the “Salary”). The Executive’s Salary from July 1, 2016 through December 31, 2016 shall accrue as deferred compensation, and shall be paid to Executive at such time as determined by the Company’s Board of Directors, taking into consideration CFFO, but no later than December 31, 2017. The Salary subsequent to January 1, 2017 shall be payable in regular installments in accordance with the Company's general payroll practices and subject to withholding and other payroll taxes.
Upon the execution of the Amendment by both parties, the Executive shall be entitled to receive an annual cash bonus equal to 30% of the bonus pool established annually by the Company and approved by the Compensation Committee of the Board of Directors (“Committee”) (“Bonus”), which Bonus shall be based on financial and other objectives established by the Committee annually, including CFFO.
The Salary paid to Executive shall include all perquisites previously paid to Executive as additional compensation under the Agreement (including automobile and healthcare allowances, athletic club membership, home internet access, and other allowances and benefits). Notwithstanding the above, Executive shall be reimbursed for expenses attributable to the business use of his cell phone;
In addition, during the Employment Period, the Executive shall be entitled to participate in all employee benefit programs from time to time for which senior executive employees of the Company and its Affiliates are generally eligible.”
Section 3(c) of the Agreement shall be renumbered Section 3(b).
Section 3(f) of the Agreement shall be deleted.
Section 3(h) of the Agreement shall be renumbered Section 3(c).
Section 3(i) of the Agreement shall be renumbered Section 3(d)
Section 4(a) of the Agreement shall be amended as follows: “June 30, 2012” in the opening sentence shall be replaced by “June 30, 2018”.
If this Amendment is acceptable, please execute this Amendment in the space set forth below and return an executed copy thereof to the Company.
Sincerely,
By: _/s/Xxxxx Jaffe__________
Name: Xxxxx Xxxxx
Title: Chairman
ACCEPTED AND AGREED TO:
XXXX XXXXXX
/s/ Xxxx Xxxxxx
Xxxx Xxxxxx
Chief Executive Officer
