EXHIBIT 10.2
E M P L O Y M E N T A G R E E M E N T
THIS AGREEMENT is made and entered into this 18th day of April, 2002
effective for the term provided herein, by and between Reliv' International,
Inc. (hereinafter referred to as the "Company") and David G. Kreher (hereinafter
referred to as the "Employee").
WHEREAS, the Employee is presently, and for some time has been, employed as
Senior Vice-President and Chief Operating Officer of the Company and has
contributed to the success of the Company;
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 (a) Employee's participation in the
Company incentive compensation program, (b) the continued employment or
retention of Employee by the Company, (c) Employee's entitlement to severance
upon termination of employment under Section 4.2 and (d) the premises and of 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 Senior Vice-
President and Chief Operating 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 (5) days written notice to Employee,
subject to the obligations of paragraph 4.8.
4.3 For purposes of this Agreement, an Event of Default with respect
to Employee shall include:
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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 60 days in any one period of 90 consecutive days. In
calculating the 60 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 thirty (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,
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(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.
4.7 In the event of termination of this Agreement and Employee's
employment hereunder by the Company pursuant to paragraph 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 paragraph 4.8.
4.8 In the event of termination of this Agreement and Employee's
employment hereunder by the Company pursuant to paragraph 4.2 hereof, the
Company shall be obligated to pay Employee an amount of severance equal to
six (6) months salary, payable by the Company to Employee over a twelve
(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 paragraph 4.5 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 Company's obligation for the continued payment of salary, additional
compensation and benefits shall terminate as of 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,
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marketing and other relationships, whether contractual or not, between the
Company, its suppliers, customers, distributors, employees, agents,
consultants and independent contractors.
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
Paragraph 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.
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
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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
subparagraph 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
Paragraph 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 paragraph 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
Paragraph 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:
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 have
gathered, and
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are 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 paragraph 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
paragraph and that the terms and conditions of this paragraph 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
Paragraph 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 paragraphs 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.
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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 a majority 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: Robert L. Montgomery
Chief Executive Officer
Reliv International, Inc.
P.O. Box 405
Chesterfield, MO 63005
If to Employee: David Kreher
P.O. Box 405
Chesterfield, MO 63005
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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 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.
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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/ David G. Kreher
- ------------------------------------
David G. Kreher
RELIV INTERNATIONAL, INC.
By: /s/ Robert L. Montgomery
---------------------------------
Authorized Officer
Attest:
/s/ Stephen M. Merrick
- ------------------------------------
Secretary
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