Exhibit 10.36
AMENDED LOCK-UP
AGREEMENT
This Amended Lock-Up Agreement
(“ Agreement ”) is made and effective
this 6 th day of November, 2003 by and between
Mannatech, Incorporated (“ Company ”), a
Texas corporation with its principal place of business located at
600 S. Royal Lane, Suite 200, Coppell, Texas 75019 and Stan
Fredrick (“ Fredrick ”) whose principal
address is 3509 Wingren, Irving, Texas 75062.
WITNESSETH:
WHEREAS , Company is in the business of operating a
network marketing company which sells a proprietary line of dietary
supplements, cosmetics and over-the-counter products (“
Products ”) and which compensates its
distributors (“ Associates ”) by a
defined compensation plan in the United States, Canada, Australia,
New Zealand, Japan and the United Kingdom;
WHEREAS, Fredrick or a trust controlled by him owns
certain shares of Common Stock of the Company (“
Shares )” ;
WHEREAS, the Parties hereto desire to restrict the sale,
assignment, transfer, encumbrance or other disposition of the
Shares subject to the terms and conditions of this
Agreement;
WHEREAS, Fredrick has agreed to certain restrictions on
the sale of Shares subject to the terms and conditions of this
Agreement;
WHEREAS , Company intends to enter into a confidential
relationship with Fredrick whereby Fredrick will acquire an
intimate knowledge and access to Company’s business and will
obtain or has obtained specialized skills. Company will permit
Fredrick to have access to and to utilize the business goodwill,
cost and pricing information, Confidential Information (as defined
herein) and various trade secrets of Company, including without
limitation, marketing programs, business relationships, customer
lists, business plans, financial data, privileged legal information
and other compilations of information developed by Company and
essential to its business; and
NOW, THEREFORE
, in consideration of the mutual
covenants and agreements contained herein and upon the terms,
conditions and provisions hereinafter set forth, Company and
Fredrick do hereby agree as follows:
ARTICLE I
DUTIES AND
COMPENSATION
|
1.1
|
Term . The term of this Agreement, unless otherwise
modified in writing, is for a one (1) year calendar period,
beginning June 15, 2003 and ending June 15, 2004 (the “
Term” ). The Term shall be extended
automatically for an additional successive one (1) calendar year
period as of each anniversary of the effective date after the
initial Term; provided however, that if either party shall give
written notice to the other at least thirty days prior to such
anniversary, then no such automatic extension shall occur and
Fredrick’s obligations under this Agreement shall terminate
on the day prior to such anniversary.
|
|
1.2
|
Compensation . In
exchange for the Share restrictions and other obligations as set
forth herein, the Company agrees to pay Fredrick $185,000 annually
payable on a monthly basis in equal installments.
|
|
1.3
|
Independent Contractor
. The Parties agree that this Agreement shall not
be considered an employment agreement nor is it an offer for
employment. Fredrick will not be eligible for any employee
benefits, nor will Company make deductions from payments to
Fredrick for taxes, bonds or the like.
|
ARTICLE II
LOCK-UP
AGREEMENT
|
2.1
|
Lock-Up
Period . Except as
contemplated in this Agreement (the “Lock-Up
Period” ), Fredrick hereby agrees during the term of
this Agreement, that he will not offer, sell, assign, pledge,
transfer, hypothecate, contract to sell, grant any option for the
sale of or otherwise dispose of, directly or indirectly, and except
to a family member or family controlled trust, upon prior written
notification to the Company, any of the Shares or securities
convertible into or exchangeable or exercisable for any shares of
common stock, enter into a transaction which would have the same
effect, or enter into any swap, hedge or other arrangement that
transfers, in whole or in part, any of the economic consequences of
ownership of the Shares, whether any such aforementioned
transaction is to be settled by delivery of the Shares or such
other securities, in cash or otherwise, or publicly disclose the
intention to make any such offer, sale, pledge or disposition, or
to enter into any such transaction, swap, hedge or other
arrangement, without, in each case, the prior written consent of
Company. Any securities received upon exercise of options granted
to Fredrick will also be subject to the provisions set forth in
this Article II. Fredrick agrees and consents to the entry and stop
transfer instructions with Company’s transfer agent against
any transfer of shares of common stock held directly or indirectly
by Fredrick not in compliance with this Agreement.
|
|
2.2.
|
Extended
Lock-Up . The Lock-Up
shall be extended so long as the Company continues to pay Fredrick
in accordance with Section 1.2 hereof or until the Company makes a
secondary offering of its common stock. Should the Company
discontinue payments, the Lock-Up will be void and the “stop
transfer” restriction will be lifted subject to the receipt
of a proper legal opinion authorizing same.
|
ARTICLE III
CONFIDENTIAL
INFORMATION
|
3.1
|
Prior to and
during the course of the Agreement, Fredrick will be given access
to Company’s Confidential Information concerning Products and
the business operations of Company.
|
|
3.2
|
Fredrick
acknowledges that in the further course of the Agreement with
Company, Fredrick will gain a close, personal and special influence
with Company’s customers and will be acquainted with all of
Company’s business, particularly Company’s Confidential
Information concerning the business of Company and its
affiliates.
|
2
|
3.3
|
For purposes of
this Agreement “ Confidential Information
” shall mean and include information disclosed to Fredrick or
known by Fredrick, not generally known in Company’s industry,
or otherwise known to Fredrick or received from a source other than
the Company about Company’s products, processes and services,
including but not limited to information concerning inventions,
trade secrets, research and development, as well as all data or
information concerning customers (including, Associates), customer
lists (including downline reports and similar reports of business
activities and relevant information concerning persons who conduct
the same), prospect lists, mailing lists, sales leads, contracts,
financial reports, sales, purchasing, price lists, product costs,
marketing programs, marketing plans, business relationships,
business methods, accounts payable, accounts receivable, accounting
procedures, control procedures and training materials.
|
|
3.4
|
Fredrick
recognizes that his position with Company is one of the highest
trust and confidence by reason of Fredrick’s access to the
Confidential Information and Fredrick agrees to use his best
efforts and will exercise utmost diligence to protect and safeguard
the Confidential Information. In this respect, Fredrick agrees that
fulfilling the obligations of this Article III const
|
|
