EMPLOYMENT AGREEMENT
EXHIBIT
10.4
THIS
EMPLOYMENT AGREEMENT
(this
“Agreement”) is made and entered into this 2nd
day of
January, 2008 effective for the term provided herein, by and between
Reliv’
International, Inc.
(hereinafter referred to as the “Company”) and Xxxxxx
X. Xxxxxxxx
(hereinafter referred to as the “Employee”).
WHEREAS,
the
Employee is presently, and for some time has been, employed as an executive
for
the Company and has contributed to the success of the Company; and
WHEREAS,
the
Company desires to be assured of the continued association and services of
Employee and Employee desires to continue in the employment of the Company
on
the terms provided herein.
NOW,
THEREFORE,
in
consideration of the continued employment or retention of Employee by the
Company, Employee’s entitlement of severance upon termination of employment
under Section 4.8 and the terms, covenants and conditions hereinafter contained,
the parties hereto agree as follows:
1. Employment,
Duties and Authority.
1.1 The
Company hereby employs Employee and Employee hereby accepts employment by the
Company on the terms, covenants and conditions herein contained.
1.2 The
Employee is hereby employed by the Company as Vice
President-Finance and Chief Financial Officer.
The
Employee shall have such duties, responsibilities and authority as the Company
shall from time to time provide.
1.3 During
the term of Employee’s employment hereunder, and subject to the other provisions
hereof, Employee shall devote his full energies, interest, abilities and
productive time to the performance of his duties and responsibilities hereunder
and will perform such duties and responsibilities faithfully and with reasonable
care for the welfare of the Company.
2. Compensation
and Benefits.
2.1 The
Company shall pay to Employee during the term of employment hereunder a basic
salary at the annual rate provided in Schedule A hereto. Such annual rate of
salary may be changed from time to time as the parties agree and such changes
shall be reflected on Schedule A when made. Such basic salary shall be paid
by
the Company to Employee each month, less amounts which the Company may be
required to withhold from such payments by applicable federal, state or local
laws or regulations.
2.2 Benefits;
Expense Reimbursement.
2.2.1 The
Employee shall be entitled to, and shall receive, all benefits of employment
as
listed on Schedule A.
2.2.2 During
the term hereof, the Company shall reimburse Employee for all reasonable and
necessary expenses incurred by Employee in the performance of his duties
hereunder, including without limitation, travel, meals, lodging, office supplies
or equipment subject to such reasonable limitations, restrictions and reporting
standards as the Employee’s supervisor or the Company may from time to time
establish. Employee shall provide to the Company promptly after incurring any
such expenses a detailed report thereof and such information relating thereto
as
the Company shall from time to time require. Such information shall be
sufficient to support the deductibility of all such expenses by the Company
for
federal income tax purposes.
3. Term.
The
employment of Employee hereunder shall be for a one-year term commencing
on the
date of this Agreement. Upon the expiration of the initial one-year term
or any
one-year renewal term of Employee’s employment hereunder, the term of such
employment shall be automatically renewed for an additional term of one year,
unless Employee or the Company shall give notice of the termination of
Employee’s employment and this Agreement by written notice to the other more
than 30 days prior to the date of expiration of the initial or any renewal
term.
In the event that such notice of termination shall be given timely, this
Agreement shall terminate on the date of expiration of such initial or renewal
term.
4. Termination.
4.1 The
Company shall be entitled to terminate the Employee’s employment by written
notice to Employee prior to the expiration of its term or any renewal
term:
4.1.1 in
the
event of an Event of Default with respect to Employee as provided herein,
or
4.1.2 upon
the
permanent mental or physical disability of Employee as provided herein occurring
during the term or any renewal term of Employee’s employment
hereunder.
4.2 The
Company shall be entitled to terminate the Employee’s employment at any time
upon five days written notice to Employee, subject to the obligations of
Section
4.8.
1
4.3 For
purposes of this Agreement, an Event of Default with respect to Employee shall
include:
4.3.1 Any
failure by Employee to perform his duties, responsibilities or obligations
hereunder in a faithful and diligent manner or with reasonable care and (if
such
failure can be cured) the failure by Employee to cure such failure within a
reasonable amount of time after written notice thereof shall have been given
to
Employee by the Company; or
4.3.2 Commission
by Employee of any material act of dishonesty as an employee of the Company
or
of disloyalty to the Company, or any wrongful or unauthorized appropriation,
taking or misuse of funds, property or business opportunities of the
Company.
4.4 Permanent
mental or physical disability of Employee shall be deemed to have occurred
hereunder when Employee shall have failed or been unable to perform his duties
hereunder on a full-time basis for an aggregate of 180 days in any one period
of
210 consecutive days. In calculating the 180-day time period, unpaid leave
which
qualifies under, and which was provided by the Company pursuant to, the Family
and Medical Leave Act of 1993, as amended, shall not be counted.
4.5 Employee
shall be entitled to terminate his employment with the Company under this
Agreement prior to the expiration of its term or any renewal term upon 30 days
written notice or immediately upon the occurrence of an Event of Default with
respect to the Company.
4.6 For
purposes of this Agreement an Event of Default with respect to the Company
shall
include:
4.6.1 Any
failure by the Company to perform its obligations to Employee under this
Agreement and (if such failure can be cured) the failure by the Company to
cure
such failure within a reasonable amount of time after written notice thereof
shall have been given to the Company by Employee;
4.6.2 The
Company shall:
(a) admit
in
writing its inability to pay its debts generally as they become
due,
(b) file
a
petition for relief under any chapter of Title 11 of the United States Code
or a
petition to take advantage of any insolvency under the laws of the United States
of America or any state thereof,
(c) make
an
assignment for the benefit of its creditors,
(d) consent
to the appointment of a receiver of itself or of the whole or any substantial
part of its property,
(e) suffer
the entry of an order for relief under any chapter of Title 11 of the United
Sates Code, or
(f) file
a
petition or answer seeking reorganization under the Federal Bankruptcy Laws
or
any other applicable law or statute of the United States of America or any
state
thereof.
2
4.7 In
the
event of termination of this Agreement and Employee’s employment hereunder by
the Company pursuant to Section 4.1 or 4.2 hereof, all rights and obligations
of
the Company and Employee hereunder shall terminate on the date of such
termination, except for Employee’s right to receive (subject to any rights of
set off or counterclaim by the Company) all salary, additional compensation
and
benefits which shall have accrued prior to the date of such termination as
well
as all other rights of the Company or Employee which shall have accrued
hereunder prior to the date of such termination. The obligation of the Company
for any further payment of salary, additional compensation or benefits shall
terminate as at the date of such termination, subject to Section
4.8.
4.8 In
the
event of termination of this Agreement and Employee’s employment hereunder by
the Company pursuant to Section 4.2 hereof, the Company shall be obligated
to
pay Employee an amount of severance equal to six months salary, payable by
the
Company over a 12-month period to commence on the date of
termination.
4.9 In
the
event of termination of this Agreement by Employee in accordance with Section
4.5 hereof, all rights and obligations of the Company and Employee hereunder
shall terminate on the date of such termination, except for (i) Employee’s right
to receive (subject to any rights of set off or counterclaim by the Company)
all
salary, additional compensation and benefits which shall have accrued prior
to
the date of such termination, (ii) severance equal to six months salary, payable
by the Company over a 12-month period to commence on the date of termination
and
(iii) all other rights of the Company or Employee which shall have accrued
hereunder prior to the date of such termination.
5. Confidential
Information.
5.1 “Confidential
Information” for purposes of this Agreement means any and all information
disclosed by the Company to Employee, whether provided or received orally or
in
writing, relating to or concerning the business, projects, products, processes,
formulas, know-how, techniques, designs or methods of the Company, whether
relating to research, development, manufacture, purchasing, accounting,
engineering, marketing, merchandising, selling or otherwise. Without limitation,
Confidential Information shall include all know-how, technical information,
inventions, ideas, concepts, processes and designs relating to products of
the
Company, whether now existing or hereafter developed, and all prices, customer
or distributor names, customer or distributor lists, marketing and other
relationships, whether contractual or not, between the Company, its suppliers,
customers, distributors, employees, agents, consultants and independent
contractors.
3
5.2 Employee
agrees that he will not disclose any Confidential Information to any person
and
will not use any Confidential Information for any purpose other than in the
performance of his duties for the Company or in the course of business dealings
with the Company. Confidential Information shall not include information, which,
at the time, Employee can show (i) is generally known to the public other than
as a result of disclosure by the Employee or by other wrongful disclosure or
(ii) became known to the Employee from a source other than the Company or any
of
its employees, agents or representatives in a communication not involving a
wrongful disclosure.
5.3 Employee
agrees that, during the term hereof or while Employee shall receive compensation
hereunder and after termination of his employment with the Company for so long
as the Confidential Information shall not be generally known or generally
disclosed (except by Employee or by means of wrongful use or disclosure),
Employee shall not use any Confidential Information, except on behalf of the
Company, or disclose any Confidential Information to any person, firm,
partnership, company, corporation or other entity, except as authorized by
the
Company.
5.4 Without
limiting the foregoing, Employee acknowledges and agrees that the Company has
developed, and is developing, at great expense, (i) relationships with its
distributors and customers; (ii) information and records pertaining to
distributors and customers including, but not limited to, genealogies, sales
volumes, compensation, rank, addresses and phone numbers; and (iii) technical
information concerning products and methods of marketing and sale which is
all
kept and protected as Confidential Information and trade secrets and are of
great value to the Company.
5.5 Employee
acknowledges and agrees that the obligations under this Section
5
shall survive termination of this Agreement and Employee shall continue to
be
bound by this provision as provided herein.
6. Inventions.
6.1 “Inventions”
shall mean discoveries, concepts, ideas, designs, methods, formulas, know-how,
techniques or any improvements thereon, whether patentable or not, made,
conceived or developed, in whole or in part, by Employee.
4
6.2 Employee
covenants and agrees to communicate and fully disclose to the Company any and
all Inventions made or conceived by him during the performance of his duties
for
the Company and further agrees that any and all such Inventions which he may
conceive or make, during the term hereof or while receiving any compensation
or
payments from the Company, shall be at all times and for all purposes regarded
as acquired and held by him in a fiduciary capacity and solely for the benefit
of the Company. The provisions of this Section 6.2 shall not apply to an
invention for which no equipment, supplies, facilities, Confidential Information
or trade secret information of the Company was used and which was developed
entirely on the Employee’s own time, unless (a) the invention relates (i) to the
business of the Company, or (ii) to the Company’s actual or demonstrably
anticipated research or development, or (b) the invention relates from any
work
performed by Employee for the Company.
6.3 Employee
acknowledges and agrees that the obligations under this Section
6
shall survive termination of this Agreement and Employee shall continue to
be
bound by this provision as provided herein.
7. Writings
and Working Papers.
7.1 Employee
covenants and agrees that any and all letters, pamphlets, drafts, memoranda
or
other writings of any kind written by him for or on behalf of the Company or
in
the performance of Employee’s duties hereunder, Confidential Information
referred to in Section 5.1 hereof and all notes, records and drawings made
or
kept by him of work performed in connection with his employment by the Company
shall be and are the sole and exclusive property of the Company and the Company
shall be entitled to any and all rights relating thereto. Employee also agrees
that upon request he will place all such notes, records and drawings in the
Company’s possession and will not take with him without the written consent of a
duly authorized officer of the Company any notes, records, drawings, blueprints
or other reproductions relating or pertaining to or connected with his
employment of the business, books, textbooks, pamphlets, documents work or
investigations of the Company.
7.2 Employee
acknowledges and agrees that the obligations under this Section
7
shall survive termination of this Agreement and Employee shall continue to
be
bound by this provision as provided herein.
8. Covenant
Not to Solicit.
8.1 Employee
acknowledges and agrees as follows:
5
8.1.1 That
the
Company has developed, and is developing and establishing, a valuable and
extensive trade in its services and products, including without limitation,
nutritional, food and dietary products, and skin care products and that it
has
developed, and is developing, operations and distributors to sell such products
and services throughout the United States and in foreign countries.
8.1.2 That
the
Company has developed, and is developing, at great expense, relationships with
its distributors and customers and has gathered, and is gathering, information
and records pertaining to such distributors and customers including, but not
limited to, genealogies, sales volumes, compensation, rank, addresses and phone
numbers, all of which are kept and protected as Confidential Information and
trade secrets and are of great value to the Company.
8.1.3 That,
during the course of his employment with the Company and during the term of
this
Agreement, Employee has acquired and will acquire, possession of Confidential
Information.
8.1.4 That
the
conduct covered by the restrictive covenant in this Section includes only a
percentage of the total number of individuals who are distributors or potential
distributors of products with respect to which Employee has knowledge or
expertise, that Employee would be able to utilize his knowledge, experience
and
expertise for an employer while fully complying with the terms of this Section
and that the terms and conditions of this Section are reasonable and necessary
for the protection of the Company’s business and assets.
8.2 Employee
agrees that, during the term of this Agreement, for so long as Employee shall
be
receiving compensation hereunder, and for a period of 24 months from and after
the date of termination of this Agreement, he will not, directly or indirectly,
whether as an employee, independent distributor, agent, officer, consultant,
partner, owner, shareholder or otherwise, solicit, recommend, suggest, or induce
any person who is, or at any time during the term of this Agreement has been,
a
distributor for the Company, to become a distributor for, or otherwise become
associated with, any person or organization (other than the Company) engaged
in
the business of marketing or selling any product or service by means of any
direct sales, network marketing or multilevel marketing method or organization.
8.3 Employee
acknowledges and agrees that the obligations under this Section
8
shall survive termination of this Agreement and Employee shall continue to
be
bound by this provision as provided herein.
9. Survival
All
provisions of this Agreement provided herein to survive termination of
employment of Employee hereunder, shall survive such termination and the Company
and Employee shall continue to be bound by such provisions in accordance with
the terms thereof. Without limiting the foregoing, the obligations of Employee
pursuant to Sections 5, 6, 7 and 8 provided herein shall survive such
termination and the Employee shall continue to be bound by such provisions
in
accordance with their terms.
6
10. Assignment.
The
rights and duties of a party hereunder shall not be assignable by that party,
except that the Company may assign this Agreement and all rights and obligations
hereunder to, and may require the assumption thereof by, any corporation or
any
other business entity which succeeds to all or substantially all the business
of
the Company through merger, consolidation or corporate reorganization or by
acquisition of all or substantially all of the assets of the
Company.
11. Binding
Effect.
This
Agreement shall be binding upon the parties hereto and their respective
successors in interest, heirs and personal representatives and, to the extent
permitted herein, the assigns of the Company. The parties acknowledge and agree
that all rights and obligations by and between the parties under this Agreement
pertain to subsidiaries and Affiliates of the Company, if appropriate.
“Affiliate” shall mean any corporation of which the Company, or any Affiliate,
shall own more than 20% of the capital stock.
12. Severability.
If
any
provision of this Agreement or any part hereof or application hereof to any
person or circumstance shall be finally determined by a court of competent
jurisdiction to be invalid or unenforceable to any extent, the remainder of
this
Agreement, or the remainder of such provision or the application of such
provision to persons or circumstances other than those as to which it has been
held invalid or unenforceable, shall not be affected thereby and each provision
of this Agreement shall remain in full force and effect to the fullest extent
permitted by law. The parties also agree that, if any portion of this Agreement,
or any part hereof or application hereof, to any person or circumstance shall
be
finally determined by a court of competent jurisdiction to be invalid or
unenforceable to any extent, any court may so modify the objectionable provision
so as to make it valid, reasonable and enforceable.
13. Notices.
All
notices, or other communications required or permitted to be given hereunder
shall be in writing and shall be delivered personally or mailed, certified
mail,
return receipt requested, postage prepaid, to the parties as
follows:
| If to the Company: | Xxxxxx X. Xxxxxxxxxx | ||
| Chief Executive Officer | |||
| Reliv International, Inc. | |||
| X.X. Xxx 000 | |||
| Xxxxxxxxxxxx, XX 00000 | |||
| If to Employee: | To the Employee at his | ||
| address on the records of | |||
| the Company | |||
7
Any
notice mailed in accordance with the terms hereof shall be deemed received
on
the third day following the date of mailing. Either party may change the address
to which notices to such party may be given hereunder by serving a proper notice
of such change of address to the other party.
14. Entire
Agreement.
This
Agreement constitutes the entire agreement between the parties hereto with
respect to the subject matter hereof and supersedes all prior written or oral
negotiations, representations, agreements, commitments, contracts or
understandings with respect thereto, including without limitation any agreements
providing for compensation of any kind including deferred compensation or salary
continuation, and no modification, alteration or amendment to this Agreement
may
be made unless the same shall be in writing and signed by both of the parties
hereto.
15. Waivers.
No
failure by either party to exercise any of such party’s rights hereunder or to
insist upon strict compliance with respect to any obligation hereunder, and
no
custom or practice of the parties at variance with the terms hereof, shall
constitute a waiver by either party to demand exact compliance with the terms
hereof. Waiver by either party of any particular default by the other party
shall not affect or impair such party’s rights in respect to any subsequent
default of the same or a different nature, nor shall any delay or omission
of
either party to exercise any rights arising from any default by the other party
affect or impair such party’s rights as to such default or any subsequent
default.
16. Governing
Law; Jurisdiction.
16.1 For
purposes of construction, interpretation and enforcement, this Agreement shall
be deemed to have been entered into under the laws of the State of Missouri
and
its validity, effect, performance, interpretation, construction and enforcement
shall be governed by and subject to the laws of the State of
Missouri.
16.2 This
Agreement is governed by and construed in accordance with the laws of the State
of Missouri. Any and all disputes arising out of or relating to this Agreement
will be resolved and determined by arbitration in accordance with existing
rules
and regulations of the American Arbitration Association. The exclusive location
for such arbitration shall be St. Louis, Missouri. The decision of the
arbitrator(s) will be final and binding on all parties and the judgment may
be
entered in a court of competent jurisdiction. Demands for arbitration must
be
filed within the applicable time period provided by Missouri statute. Failure
to
make a demand for arbitration within this period will result in the waiver
and
loss of all claims by Employee with respect to the dispute.
8
IN
WITNESS WHEREOF,
the
parties hereto have executed this Agreement as of the day and year first above
written.
THIS
CONTRACT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY BE ENFORCED BY
THE
PARTIES.
EMPLOYEE:
| \s\ Xxxxxx X. Alright | |
| Xxxxxx X. Xxxxxxxx |
RELIV
INTERNATIONAL, INC.
| By:\s\ Xxxxxx X. Xxxxxxxxxx | |
| Authorized Officer |
Attest:
| \s\ Xxxxxxx X. Xxxxxxx | |
| Secretary |
9
|
SCHEDULE
A
|
|||||||||||||
|
Xxxxxx
X. Xxxxxxxx
|
|||||||||||||
|
|
|
Comments
|
Monthly
|
Annual
|
|||||||||
|
Base
Salary
|
|
Per
Contract
|
$
|
15,000
|
$
|
180,000
|
|||||||
|
|
|
|
|
||||||||||
|
Incentive
Compensation*
|
|
Pool
1 - 7%
|
|
|
|
||||||||
|
|
|
|
|
||||||||||
|
Health
and Dental Insurance
|
(1
|
)
|
Standard
Company Plan
|
$
|
427.35
|
$
|
5,128.20
|
||||||
|
|
|
|
|
||||||||||
|
Life
Insurance Allowance
|
|
|
|
$
|
2,000
|
||||||||
|
|
|
|
|
||||||||||
|
|
|
|
|
||||||||||
|
Life
Insurance-$10,000 in coverage
|
|
Standard
Company Plan
|
|
$
|
187.20
|
||||||||
|
|
|
|
|
||||||||||
|
Long
and Short Term
|
|
|
|
||||||||||
|
Disability
Insurance
|
|
Standard
Company Plan
|
|
$
|
1,358
|
||||||||
|
|
|
|
|
||||||||||
|
Vacation
(Days)
|
|
20
Days
|
|
$
|
13,846
|
||||||||
|
|
|
|
|
||||||||||
|
401(k)
Matching Contribution*
|
|
Standard
Company Plan
|
|
|
|||||||||
|
|
|
|
|
||||||||||
|
ESOP
Contribution*
|
|
Standard
Company Plan
|
|
|
|||||||||
|
|
|
|
|
||||||||||
|
|
|
|
|
||||||||||
|
Total
|
|
|
|
$
|
202,519
|
||||||||
|
*Estimated
value will be adjusted to actual at end of each calendar
year
|
|||||||||||||
|
(1)
Monthly amount represents net Company contribution after employee
contribution.
|
|||||||||||||
11
