AMENDED AND RESTATED EMPLOYMENT
AGREEMENT
THIS EMPLOYMENT AGREEMENT (the
“Agreement”) is made and entered into this 31
st day of December 2008 by and between RBC
Life Sciences, Inc. (“Employer”) located at 2301 Crown
Court, Irving, Texas 75038 and John W. Price
(“Employee”), residing at 2621 King Arthur Blvd.,
Lewisville, Texas 75056.
WHEREAS, Employer is engaged in, among other
businesses, the international distribution of nutritional
supplements and personal care products through the network
marketing distribution model, and the distribution of wound care
and oncology care products; and
WHEREAS, Employer desires to continue
Employee’s employment, on the terms and conditions set forth
in this Agreement as an amendment and restatement of the existing
employment agreement between Employer and Employee dated
December 7, 2007; and
WHEREAS,
Employee is willing to accept such continued employment;
NOW, THEREFORE, in consideration of the mutual
covenants and promises set forth in this Agreement, Employer and
Employee hereby agree as follows:
Section 1.
Effective Date and Purpose . The effective date of
this Agreement shall be January 1, 2009 (the “Effective
Date”), except that the provisions hereof revising provisions
of Employee’s current employment agreement for purposes of
complying with Section 409A of the Internal Revenue Code of
1986, as amended (the “Code”) shall be effective
December 31, 2008. This Agreement sets forth the terms and
conditions of Employee’s employment with Employer and amends
and restates the existing employment agreement between Employee and
Employer regarding Employee’s employment.
Section 2.
Employment Title and Duties . Employer hereby
continues the employment of Employee and Employee hereby accepts
such continued employment by Employer on the terms and subject to
the conditions hereunder set forth. Employer shall employ Employee
in the capacity of Chief Executive Officer and President. In this
capacity, Employee shall have the responsibility to perform all
duties that are customarily performed by one holding that position
in other, same, or similar businesses or enterprises as that
engaged in by Employer. Employee accepts this employment, subject
to the general supervision and pursuant to the orders and direction
of Employer’s Board of Directors (the “Board”).
Employee shall also render such other services and duties,
consistent with such capacity, as may be assigned from time to time
by the Board.
Section 3.
Compensation of Employee . Employer shall pay
Employee, in full payment for Employee’s services and
covenants under this Agreement, the following
compensation:
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(a)
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Salary . During his employment pursuant to
this Agreement, Employee’s base salary shall be $325,000
payable bi-weekly in equal payments of $12,500 in accordance with
Employer’s customary payroll practices. Employee’s base
salary shall be reviewed by the Compensation Committee of the
Company’s Board of Directors (the “Compensation
Committee”) annually during the term of this Agreement and
such base salary may be increased by the Compensation Committee as
determined in its sole discretion.
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(b)
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Incentive Bonus
. During his
employment, Employee shall have a reasonable opportunity to earn a
cash incentive bonus for calendar year 2009 as described in
Exhibit A and thereafter, based on bonus criteria adopted by
the Compensation Committee of the Board (the “Compensation
Committee”). The Board of Directors will adopt an annual cash
incentive bonus plan each year during the term of this Agreement.
Any annual incentive bonus that becomes payable pursuant to this
Agreement shall be paid in a lump sum payment between January 1 and
March 15 of the year following the year for which the annual
bonus was earned.
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(c)
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Health and Welfare
Benefits . Employee shall be entitled to
participate in the benefit plans and programs offered from time to
time for executive employees, such as those set forth in the manual
for executive employees that covers Employer’s executives,
such benefits to include but not be limited to personal time off,
holidays, dental and vision insurance coverage and participation in
Employer’s 401(k) Plan. All benefit plans are subject to the
terms and conditions contained in the applicable plan and program
documents as such documents may be amended from time to
time.
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(d)
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Equity Awards
. Employee will be
granted a stock option to purchase 200,000 shares of
Employer’s common stock under the Employer’s stock
incentive plan on the Effective Date with an exercise price per
share equal to the fair market value of Employer’s common
stock on the date of grant as determined by the Compensation
Committee. Such stock option will vest and become exercisable at
the rate of 25% per year during Employee’s employment with
Employer over a four-year period commencing on the date of grant
and ending on the fourth anniversary of the date of grant. Employee
may receive additional equity awards during the term of this
Agreement as deemed appropriate by the Compensation
Committee.
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(e)
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Automobile Allowance
. Employer shall pay to
Employee an automobile allowance in an amount equal to $1,000 per
month, payable in accordance with Employer’s customary
payroll practices.
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(f)
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Purchase of Employer
Products . Employee shall be eligible to
receive each month during the term of this Agreement up to $1,000
of Employer products offered for sale to third parties, as selected
by Employee, the value of which will be based on employee pricing
as set forth in Employer’s policies and guidelines regarding
purchases of Employer’s products by employees.
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(g)
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Club Dues
. Employer will
reimburse Employee each month during the term of this Agreement an
amount equal to 50% of his ClubCorp Dallas Fort Worth Society
monthly dues. Employer’s reimbursement obligation applies
only to Employee’s monthly base dues and business use
expenses and does not include any additional monthly expenses
incurred by, or charged to, Employee as personal
expenditures.
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(h)
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Vacation and Personal Time
Off .
Employee shall be entitled to 20 days of vacation and personal time
off (“PTO”) per year to be accrued in accordance with
Employer’s vacation policy and personal time off policy in
effect from time to time.
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(i)
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Agreement Review
. Employer will
reimburse Employee for legal fees incurred by Employee during the
term of this Agreement in connection with the review of this
Agreement, including any supplements and/or amendments thereto, by
Employee’s legal counsel in an amount not exceeding $2,000 in
any calendar year, supported by proper documentation submitted by
Employee to Employer.
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Section 4.
Best Efforts of Employee . Employee agrees to perform
all of the duties pursuant to the express and implicit terms of
this Agreement to the reasonable satisfaction of the Board.
Employee further agrees to perform such duties faithfully and to
the best of his ability, talent, and experience.
Section 5.
Place of Employment . Employee shall render such
duties at 2301 Crown Court, Irving, Texas 75038 and at such other
places as Employer shall in good faith require or as the interest,
needs, business, or opportunity of Employer shall
require.
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Section 6.
Non-Competition with Employer during Employment .
Employee shall devote all his time, attention, knowledge, and
skills solely to the business and interest of Employer, and
Employer shall be entitled to all of the benefits and profits
arising from the work of Employee. Employee shall not, during his
employment under this Agreement, perform services for or be
interested directly or indirectly, in any manner, as partner,
officer, director, shareholder, advisor, consultant, employee, or
in any other capacity in any other business similar to
Employer’s business, any allied trade, or any business
offering a competing or alternative product or service. However,
nothing contained in this section shall prevent or limit Employee
from continuing to receive the benefits of relationships previously
described to Employer or investing in the capital stock or other
securities of any corporation whose stock or securities are
publicly owned and traded on any public exchange, nor shall
anything contained in this Section 6 prevent or limit Employee
from investing in real estate.
Section 7.
Confidentiality and Nondisclosure . Employer promises
to disclose to Employee and Employee acknowledges that in and as a
result of his employment by Employer, he will receive, be making
use of, acquiring, and/or adding to confidential information of a
special and unique nature and value relating to such matters as
Employer’s trade secrets and proprietary and confidential
business information, including but not limited to, its unique
business methods and strategies, processes, product and design
development, programs and programming codes, pricing methods,
operating techniques and practices, operating and production costs,
corporate financial information, customer requirements, customer
and supplier information, potential customer lists and marketing
techniques, systems, procedures, manuals, confidential reports, the
equipment and methods used and preferred by its customers and the
fees paid by them, and compilations of information, records, and
specifications (all of which are referred to collectively herein as
“Confidential Matters”). Employee further agrees that
if a third party (e.g., vendors, customers and manufacturers)
contracts with Employer, the information obtained or received from
a third party including, but not limited to, its patents,
copyrights, proprietary information, trade secrets, systems,
product development, procedures, manuals, and confidential reports
will be treated in the same manner and subject to the same
protection as other Confidential Matters.
Employee acknowledges that Employer does not
voluntarily disclose Confidential Matters, but rather takes
precautions to prevent their dissemination except pursuant to
suitable confidentiality safeguards. Employee further acknowledges
that Confidential Matters (1) are secret and not known in the
industry; (2) have been and will be entrusted to Employee
because Employee is a fiduciary of Employer; (3) have been and
will be developed by Employer and/or Employee for and on behalf of
Employer through substantial expenditures of time, effort, and
money and are and will be used in Employer’s business;
(4) give Employer an opportunity to obtain an advantage over
competitors who do not know or use the Confidential Matters; and
(5) are of such value and nature as to make it reasonable and
necessary for Employee and Employer to protect and preserve the
confidentiality and secrecy of the Confidential Matters.
Employee acknowledges and agrees that the
Confidential Matters are valuable, special, and unique assets of
Employer, the disclosure of which could cause substantial injury
and loss of profits and good will to Employer. The Confidential
Matters to be prepared or compiled by Employee and/or Employer or
furnished to Employee prior to or during Employee’s term as
an employee of Employer shall be the sole and exclusive property of
Employer. Upon the separation of Employee’s employment with
Employer, all documents and things related to Confidential Matters
shall be returned to Employer as soon as practicable and none shall
be retained by Employee, including any copies.
As a condition of employment and continued
employment, Employee shall keep confidential all such confidential
and proprietary information that Employee learns or acquires as a
result of his employment with Employer, and shall not at any time
except as necessary to conduct the business of Employer, directly
or indirectly make known, divulge, use, furnish, or reveal to any
person, firm, company, corporation, or anyone else any of the
Confidential Matters or any knowledge or information with respect
thereto, or otherwise use such information for any purpose
whatsoever. Employee promises that Employee will take all steps
necessary to safeguard all Confidential Matters and to prevent
their use, disclosure, or dissemination to any other person or
entity except as necessary to conduct the business of
Employer.
Employee further agrees that in the event
Employee is subpoenaed, served with any legal process or notice, or
otherwise requested to produce or divulge, directly or indirectly,
any Confidential Matters by any entity, agency, or person in any
formal or informal proceeding, including, but not limited to, any
interview, deposition, administrative or judicial hearing, and/or
trial, upon Employee’s receipt of such subpoena, process,
notice, or request, Employee shall immediately notify and deliver a
copy of the subpoena, process, notice, or request to the Board.
Employee further irrevocably nominates, constitutes, and appoints
Employer (specifically including any attorney retained by Employer)
as Employee’s true and lawful attorney-in-fact, to act in
Employee’s name, place, and stead to do and perform any act
which Employee might perform, including to institute, prosecute,
defend, quash, compromise, settle, arbitrate, release, and dispose
of any and all legal, equitable, or administrative hearings,
actions, suits, attachments, subpoenas, claims, levies, or other
proceedings, or otherwise engage in or defend any and all
litigation in connection with or relating to any request to
disclose, directly or indirectly, any Confidential Matters;
provided, however, that Employer shall be under no obligation to
act as Employee’s attorney-in-fact and may decline to do so
upon written notice to Employee.
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Section 8.
Term . This Agreement, amending and restating the
existing employment agreement between the parties hereto, shall be
effective for an initial term of four (4) years beginning on
January 1, 2009 and ending on December 31, 2012. This
Agreement shall be automatically renewed for an additional two-year
period upon expiration of its initial term and each subsequent term
thereafter, unless either Employer or Employee gives written notice
to the other party at least ninety (90) days prior to the last
day of the then current term of the Agreement.
Section 9.
Termination of Employment .
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(a)
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Non-renewal of Agreement by
Employer . If Employer elects not to renew
employment under this Agreement pursuant to the terms of
Section 8, Employee, unless otherwise requested by Employer,
shall continue to render services, and shall be paid compensation
as provided in this Agreement, through the last day of the current
term of the Agreement. In addition, if (i) at the time
Employer elects not to renew Employee’s employment under this
Agreement, Employee is willing and able to execute a new agreement
containing terms and conditions substantially similar to those in
this Agreement and to continue to provide services to Employer
substantially similar to the services provided at the time Employer
elects not to renew and (ii) Employee executes a general
release in the form and at the time requested by Employer (the
“Release”), Employee shall be paid an amount equal to
twelve months of his base salary as in effect at the time of his
termination of employment payable in substantially equal payments
for a period of twelve (12) months as severance pay following
the date of termination payable in accordance with Employer’s
customary payroll practices and commencing, unless otherwise
required by Section 10(b), on the first payroll date of
Employer following the expiration of the applicable statutory
periods for considering and revoking the Release, determined
without regard to when Employee executes the Release (the
“Release Date”) and previously accrued, unused PTO paid
in a single lump sum payment on the first payroll date of Employer
following the Release Date. The amounts paid shall be reduced by
all amounts withheld and deducted pursuant to Section 20. No
benefits, bonuses, PTO, or other forms of compensation, except for
the severance payments, will be paid to or accrued by Employee
during the severance payment period. Notwithstanding the foregoing
provisions, if Employer and Employee agree to continue
Employee’s employment on a consulting basis following the
Employer’s non-renewal of this Agreement, Employee will not
be entitled to the severance pay referred to in this
Section 9(a). Payments under this Section 9(a) shall cease if
during the term of the payments Employee violates the provisions of
Section 7 or Section 13.
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(b)
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Non-renewal of Agreement by
Employee . If Employee elects to resign prior
to the expiration of the then current term of this Agreement
pursuant to the terms of Section 8, Employee shall continue to
render services, unless otherwise requested by Employer, through
the last day of the current term of the Agreement. If Employee
complies with this requirement, he shall be paid his monthly base
salary as provided in this Agreement through the last day of his
employment, plus any accrued, unused PTO or additional compensation
that may have otherwise accrued during the current term of this
Agreement paid in a single lump sum payment as part of
Employee’s final payroll check, and any annual incentive
bonus earned by Employee for his final year of employment will be
paid as provided in Section 3(b).
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(c)
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Termination by Employer for
Cause .
Employer may immediately terminate the employment of Employee under
this Agreement for “Cause” (as defined below) at any
time by giving written notice of termination to Employee without
prejudice to any other remedy to which Employer may be entitled
either at law or in equity under this Agreement. In this case,
Employee will be paid his base salary up to the date of his
termination of employment and shall not be entitled to any other
compensation or benefits under this Agreement.
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For purposes of
this Agreement, “Cause” shall mean, in each case, as
reasonably determined by the Board: (i) conviction of, or
entry of a pleading of guilty or no contest by, Employee with
respect to a felony or any lesser crime of which fraud or
dishonesty is a material element, (ii) Employee’s
willful and continued failure to perform his duties with Employer,
or a failure to follow the lawful direction of the Board after the
Board delivers a written demand for performance and Employee
neglects to cure such a failure to the reasonable satisfaction of
the Board within 60 days after receipt of the demand,
(iii) Employee’s failure to comply with applicable laws
with respect to the execution of Employer’s business
operations or his material breach of Sections 6 or 7 of this
Agreement, (iv) Employee’s theft, fraud, embezzlement,
dishonesty, or similar conduct which has resulted or is reasonably
likely to result in material damage to Employer or any of its
affiliates or subsidiaries, or (v) Employee’s habitual
intoxication or continued abuse of illegal drugs which interferes
with Employee’s ability to perform his assigned duties and
responsibilities.
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(d)
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Termination by Employee for Good
Reason .
Employee may terminate his employment under this Agreement for
“Good Reason” (as defined below) at any time by giving
written notice of termination to Employer without prejudice to any
other remedy to which Employee may be entitled either at law or in
equity under this Agreement. In this case, if Employee executes a
Release, Employee shall be paid an amount equal to the greater of
(i) his monthly base salary through the last day of the
initial term or renewal term then in effect, plus an amount equal
to his accrued, unused PTO or (ii) his monthly base salary for
a period of twelve (12) months, increased by two weeks for
each “Year of Service” (as defined in
Section 9(h)) performed by Employee prior to his termination
date, as severance pay following the date of termination payable,
in each case, for a period of twelve (12) months in accordance
with Employer’s customary payroll practices and commencing,
unless
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